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Undesirable  Results 

of 
German  Social  Legislation 


BY 
LUDWIG   BERNHARD 

PROFESSOR  OF  POLITICAL  ECONOMY 

AT  THE 

University  of  Berlin 

(JULIUS  SPRINGER,  BERLIN,  1813) 


Translated  by 

HAROLD  G.  VILLARD 


rorkmen's   Compensation    Publicity   Bureau 

80  Maiden  Lane,  New  York 
1914 


Undesirable  Results 

of 
German  Social  Legislation 


BY 

LUDWIG   BERNHARD 

PROFESSOR  OF  POLITICAL  ECONOMY 

AT  THE 

University  of  Berlin 

(JULIUS  SPRINGER,  BERLIN,  1913) 

• 
»     >  •  V 


Translated  by 

HAROLD  G.  VILLARD 


Workmen's  Compensation   Publicity  Bureau 

80  Maiden  Lane,  New  York 
1914 


CONTENTS 


INTRODUCTION 
PART  FIRST 

GOVERNMENTAL    REGULATION    AND    PRIVATE    HELPLESSNESS 

PAGE 

Chap.      I.      Governmental  Authorization  of   Private  Industrial  En- 
terprises          7 

Chap.     II.      Governmental    Supervision    of    Private    Industrial    En- 
terprises    - 15 

Chap.  III.      Governmental   Regulation   of   Private   Industrial   Enter- 
prises         23 

Chap.   IV.      Government   Acquisition   of   Private   Industrial   Under- 
takings         28 

PART    TWO 

THE   STRUGGLE   FOR   INSURANCE  PENSIONS 

Introduction    39 

Chap.      I.      Medical  Literature   40 

Chap.    II.      Undesirable  Results  of  Pension  Insurance 45 

Chap.  III.      Simulation    49 

Chap.    IV.      Pension  Mania  and  its  Widespread  Dissemination.,...  53 

Chap.  V.  The  Difficulty  of  Securing  Reform  Legislation 63 

The  Simplification  of  Procedure 64 

The  Restorative  Treatment  During  the  Waiting 

Period  66 

The  Abolishment  of  Appeals  Free  of  Cost 68 

The  Reform  of  Small  Pensions  for  Partial 

Disability  70 

The  Question  of  Lump  Sum  Payments  71 

Conclusion 74 

PART   THREE 

THE    MISUSE    OF    SOCIAL-POLITY    INSTITUTIONS    IN    PARTY    POLITICS 

Introduction    76 

Chap.    I.      The  Electoral  Campaign     77 

Chap.  II.      Party  Rule    81 

CONCLUSION 

The  Limits   of   Social   Legislation 88 


M35298 


INTRODUCTION. 

In  the  literature  of  all  countries,  this  question  always  returns : 
How  far  may  the  freedom  of  movement  of  the  individual,  his 
spirit  of  enterprise,  his  independence  and  sense  of  personal  re- 
sponsibility, how  far  may  and  should  these  sacred  powers  be  re- 
stricted out  of  a  proper  regard  for  the  interests  of  the  whole 
body  of  the  people? 

The  philosopher,  the  politician,  the  clergyman  and  the  technical 
man,  all  these  are  thinking  of  and  discussing  this  question.  But 
no  one  has  determined  with  absolute  certainty  the  point  at  which 
legislation  in  the  interests  of  society  as  a  whole  should  stop.  Nor 
will  anyone  ever  be  in  a  position  to  do  this,  inasmuch  as  every 
period  has  its  own  peculiar  requirements.  For  history  reveals  to 
us  a  changing  struggle  between  the  individual  and  society  in  an 
organized  form;  the  individual  contending  first  with  the  city 
commonwealth,  then  with  the  guild,  again  with  the  four  estates 
and  lastly  with  the  socialistic  community. 

We  realize  that  this  contest  between  individualistic  and 
socialistic  ideals  has  been  an  impelling  force  in  the  history  of  the 
world,  perhaps  the  greatest  impelling  force.  We  recognize  the 
highly  beneficial  effect  of  the  guilds  during  the  period  in  which 
they  arose  and  throve,  of  this  ironclad  form  of  organization,  to 
which  the  former  glory  of  German  cities  was  due.  But  we  also 
know  that  later,  when  it  was  necessary  to  bring  about  a  new  ar- 
rangement, men  of  strong  personality  burst  the  fetters  of  the 
guild  system,  and  that  those  countries  made  the  fastest  progress 
in  which  the  individual  struck  out  most  freely  and  boldly  into 
untrodden  paths. 

Thus  does  history  inform  us  of  changes  which  at  all  stages 
were  both  welcomed  and  execrated.  Every  time  such  a  change 
took  place  a  flood  of  literature  arose  dealing  with  the  old  ques- 
tion :  Where  is  the  line  to  be  drawn  between  the  rights  of  the 
individual  and  the  rights  of  society  considered  as  a  whole?  And 
each  time  the  writers  finally  had  to  admit  that  they  knew  of  no 
answer. 

Today  again  we  are  encompassed  with  a  mass  of  literary  out- 
pourings in  all  civilized  tongues,  which  ask  the  question,  Where 
is  the  line  to  be  drawn?  After  the  old  writers  have  had  their 
say  and  have  learnedly  stated  that  "on  the  one  hand"  one  ought 
not  to  destroy  the  spirit  of  initiative  in  the  individual  and  that 
"on  the  other  hand"  one  should  exercise  social  justice,  the 
younger  writers  come  forward  equipped  with  more  polished 
phrases  and  with  finer  shades  of  meaning  but  say  identically  the 
same  thing. 


Therefore,  baffled  by  the  hopeless  outlook  presented  by  this 
everlasting  repetition  of  the  same  conclusions,  I  repaired  to  the 
factories  and  propounded  to  myself  this  sober  question:  Are 
there  conditions  in  our  modern  industrial  life  which  clearly  show 
that  the  personal  sense  of  responsibility  and  the  needful  freedom 
of  movement  is  injuriously  restricted  out  of  social  considerations? 
Are  there  concrete  cases  the  facts  of  which,  described  in  detail, 
will  give  us  an  insight  as  to  where  to  draw  the  line  of  demarca- 
tion which  should  be  observed  today  ? 


PART  FIRST. 

GOVERNMENTAL     REGULATION     AND     PRIVATE 
HELPLESSNESS. 

CHAPTER  I. 

GOVERNMENTAL  AUTHORIZATION  OF  PRIVATE  INDUSTRIAL 
ENTERPRISES. 

Whoever  has  followed  the  controversy  in  regard  to  the  grant- 
ing of  concessions  (a)  might  almost  conclude  that  short-sighted 
heads  of  industry  and  a  pettifogging  bureaucracy  were  lined  up  in 
opposition  to  each  other  to  the  great  detriment  of  the  nation.  It  is 
not  easy  to  pick  one's  way  through  the  mass  of  requests  and  de- 
cisions, of  debates  and  resolutions,  of  memorials  and  reports  of 
proceedings,  and  it  is  still  more  difficult  to  determine  thereafter 
who  is  really  the  "guilty  party." 

On  the  one  hand,  we  are  informed  that  the  bureaucratic  inter- 
pretation of  the  rules  for  the  granting  of  concessions  "operates 
as  a  severe  restriction  on  industry.  It  makes  more  difficult  the 
installation  and  starting  up  of  industrial  undertakings  and  en- 
tails heavy  costs."  (*) 

We  learn  further  that  in  the  procedure  for  obtaining  con- 
cessions there  is  widespread  "a  perfect  mania  for  regulating  and 
paragraphing  everything"  whereby  "the  limits  of  official  powers 
are  often  exceeded." (2) 

"The  methods  of  the  officials  in  charge  of  concessions,"  it  is 
asserted,  "present  a  picture  which  could  hardly  have  been  more 
variegated  even  under  the  regime  of  the  old  government  police 
system.  The  procedure  for  securing  concessions  has  become  so 
long-winded  that  frequently  it  is  impossible  to  take  advantage  of 
favoring  circumstances  in  proper  season." (3) 

The  assertion  is  made  that  "in  many  cases  an  industry  in  a 
foreign  country  will  have  long  made  use  of  a  new  invention  be- 

C1)  Cf.  the  circular  address  on  Sept.  7,  1909,  to  the  members  of  the 
Deutscher  Handelstag  by  their  President  (printed  in  "Handel  und  Gewerbe" 
of  Sept.  25,  1909). 

(2)  Report  concerning  the  Result  of  an  All  Around  Inquiry  Addressed 
to    the    German    Blast-Furnaces    (printed    in    "Stahl   und   Eisen,"    1909, 
No.  19). 

(3)  From  an  address   dated  June   10,   1910,   of   the   Zentralverband 
Deutscher  Industrieller  to  the  Prussian  Minister  of  Commerce. 

(a)  Translator's  Note.  In  Germany  no  industrial  establishment  may 
be  initiated  without  first  securing  a  "concession"  or,  as  we  would  call  it 
a  "license." 


fore  a  German  industrial  employer  will  have  even  received  the 
official  permission  to  put  the  invention  to  profitable  use  in  his 
own  establishment."  (*) 

Similar  complaints  are  to  be  found  in  almost  all  branches  of 
industry,  and  they  often  contain  the  most  bitter  accusations 
against  the  officials. (2) 

If,  in  order  to  form  an  impartial  opinion  on  the  subject,  we 
should  next  ask  the  authorities  for  their  answer,  we  would  be 
told  that  in  the  opinion  of  the  officials  a  great  part  of  the  blame 
is  to  be  ascribed  to  the  industrial  owners  themselves.  The  result 
of  the  investigations  of  the  Prussian  appeal  court  showed  that 
the  officials  had  acted  improperly  in  only  very  rare  instances. 
On  the  other  hand,  the  cases  have  been  very  frequent  in  which 
the  industrial  heads  had  made  insufficient  explanations  and  had 
complicated  the  procedure  by  improper  proposals.  An  extra- 
ordinary ignorance  of  the  law  and  of  the  method  of  procedure 
prevailed  among  the  industrial  owners  in  consequence  of  which 
much  time  was  lost  in  calling  for  necessary  counter-explana- 
tions. (3) 

Thus  do  both  sides  accuse  each  other,  and  one  might  almost 
come  to  the  conclusion  that  all  shortcomings  would  disappear  if 
both  parties  would  improve  their  methods.  But  conditions  are 
much  more  complicated  in  reality ;  for  the  officials  and  industrial 
owners  have  long  been  endeavoring  to  improve  matters  as  far 


C1)     Vossen — Das   Recht   der   konzessionierten    gewerblichen   Anlagen 
Hannover,  1911,  p.  34. 

(2)  The  following  organizations  have  expressed  themselves  on  this 
point  either  alone  or  in  conjunction  with  others :    Der  Verein  zur  Wahrung 
der  Interessen  der  chemischen  Industrie  Deutschlands,  which  precedes  all 
others  in  the  effort  to  obtain  a  simplification  of  the  rules  for  securing  in- 
dustrial concessions  and  which  already  discussed  the  question  at  its  general 
meeting  in  Kiel  in  1895 ;  further  the  Verein  fur  Ton,  Zement  und  Kalkin- 
dustrie,  which  has  been  engaged  for  years  in  submitting  propositions  look- 
ing to  a  simplification  of  procedure;  in  addition,  the  Verein  Deutscher 
Portland  Zementfabriken,  Verband  Deutscher  Tonindustrieller,  Verein  der 
Kalksandsteinfabrikanten,    Verein    Deutscher    Marmorwerke,    Bergische 
Fabrikanten  Verein,   Fabrikantenverein   Hannover,   Oberschlesische   berg 
und  huttenmannische  Verein,    Verein    Deutscher    Zellstoff    fabrikanten, 
Verein  Deutscher  Motorfahrzeng-Industrieller ;  and  others. 

(3)  On  November  23,  1910,  a  conference  took  place  in  the  Prussian 
Ministry  for  Commerce  and  Industry,  at  which  the  higher  officials  were 
represented  by  the  Under   Secretary  and  several   privy   councilors,   and 
German  industry  by  several  heads  of  large  industrial  establishments  and 
by  the  general  secretaries  of  various  industrial  organizations.     At  this 
meeting  the  complaints  of  German  industry  concerning  the  procedure  in 
matters  of  concessions  were  carefully  discussed  and  two  reports  have  been 
issued  in  regard  thereto.     The  shorter  one  of  the  two  bears  simply  the 
signature  of  the  Under  Secretary,  while  the  other  is  signed  by  a  repre- 
sentative of  the  industrial  owners.    Both  reports,  which  are  not  intended 
for  publication,  were  before  me  at  the  time  this  pamphlet  was  written. 
In  addition,  the  officials  have  expressed  themselves  concerning  this  question 
quite  a  number  of  times  in  periodicals,  especially  Gewerbe  Assessor  Dr. 
Tittler,  in  the  periodical  Sozialtechnik  for  1911,  Nos.  8  and  9. 

8 


as  lay  in  their  power  and  yet  all  their  efforts  appear  to  have 
been  of  little  effect. 

In  vain  does  the  official  notice  of  May  1st,  1904,  direct  that 
requests  for  authorization  of  industrial  undertakings  "are  to  be 
treated  as  rush  matters  and  are  to  be  designated  as  such  in  the 
ordinary  course  of  business,"  and  in  vain  did  the  Prussian  Min- 
ister of  Commerce,  on  July  19th,  1911,  issue  on  order  which 
proved  beyond  all  doubt  that  he  is  thoroughly  disposed  to  hasten 
and  to  simplify  the  procedure  for  obtaining  concessions.  (*) 

The  industrial  owners  too  are  doing  everything  that  lies  in 
their  power.  Connected  with  the  unions  formed  for  the  purpose 
of  promoting  the  interests  of  our  leading  industries,  central 
bureaus  are  to  be  found,  which  as  ''law  committees"  or  as  "com- 
mittees for  concessions"  give  advice  to  the  industrial  heads,  draw 
up  and  revise  requests  for  concessions,  and  thus  endeavor  to 
smooth  the  way  for  the  speedier  dispatch  of  applications  for 
concessions. 

And  yet,  as  daily  experience  proves,  despite  all  this,  the  good 
intentions  of  the  officials  and  industrial  owners  are  by  themselves 
insufficient.  No  one  doubts,  indeed,  that  the  accelerating  direc- 
tions of  the  leading  officials  and  the  efforts  of  the  industrial  unions 
are  of  help.  Yet  everyone  who  is  at  all  familiar  with  the  practice 
in  vogue,  knows  that  the  kernel  of  the  question  is  not  to  be 
reached  through  such  directions  and  efforts,  for  the  causes  of 
the  existing  great  shortcomings  lie  far  deeper. 

In  order  to  understand  this  fully,  it  should  be  remembered 
that  the  regulations  concerning  the  authorization  of  industrial 
enterprises  are  based  on  the  conception  of  "industrial  freedom," 
which  was  laboriously  attained  after  a  fifty-year  struggle.  Ac- 
cording to  this  idea,  enterprises  which  might  be  a  source  of 
danger  or  objectionable  to  the  general  public  have  to  be  officially 
authorized.  With  the  granting  of  a  concession,  however,  they 
are  protected  against  the  imposition  of  supplementary  burdens  and 
protected  against  excessive  police  regulations.  The  struggle  cen- 
tred about  this  question ;  and,  in  an  expose  of  the  reasons  for  an 
industrial  code,  it  was  expressly  stated  that  the  legislator  was  es- 
pecially anxious  to  replace  the  police  regulations,  which  "arc 
often  so  multiform  and  so  vexatious,"  by  a  new  series  of  rules, 
and  to  guard  those  engaged  in  industry  against  "supplementary 
requirements  and  restrictions." 


(!)  The  order  of  July  19,  1911,  which  is  devoted  to  a  detailed  dis- 
cussion of  the  complaints  of  German  industry,  begins  with  these  words: 
"The  complaints  which  have  long  been  made  in  industrial  circles  regarding 
the  manner  in  which  the  procedure  for  the  authorization  of  industrial 
undertakings  is  conducted  as  prescribed  in  §16  ff.  of  the  Gewerbeordnung, 
have  decided  me  to  discuss  hereafter  verbally  with  representatives  of  the 
industries  affected  all  questions  which  have  given  cause  for  grievance.  ^  If 
these  verbal  discussions  have  not  resulted  in  any  changes  thus  far  being 
suggested  in  the  provisions  of  the  law,  nevertheless  it  appears  to  me  very 
desirable  that  one  should  work  with  the  greatest  possible  energy  in  official 
channels  for  the  abolition  of  disadvantageous  methods  of  procedure." 


On  the  surface,  these  concession-rights — secured  in  the 
struggle  for  industrial  freedom — are  still  in  existence  today.  (*) 
In  reality,  however,  the  simplified  and  abbreviated  procedure  has 
gradually  become  confused  and  distorted,  and  official  technical 
difficulties  have  been  created — I  would  almost  say  artificially — 
which  cannot  be  done  away  with  by  mere  ministerial  decree. 

These  changes  in  procedure,  which  are  severely  felt  es- 
pecially in  a  period  of  industrial  development  and  of  interna- 
tional competition,  date  their  origin  to  the  enactment  of  the 
provisions  calling  for  the  protection  of  the  workingmen. 

For  with  the  object  of  energetically  developing  schemes  of 
social  betterment,  a  triple  division  of  authority  has  been  devised, 
which,  thanks  to  the  unexampled  stupidity  displayed  by  those  in 
charge,  has  impeded  in  a  marked  degree  the  procedure  for  ob- 
taining concessions. 

How  has  this  come  to  pass?  According  to  law  a  concession 
can  be  granted  only  when  all  provisions  intended  for  the  workers' 
protection  shall  have  been  complied  with.  But  this  method  of 
development  was  not  deemed  sufficient,  and  the  following  regu- 
lation was  inserted  in  the  industrial  code  by  the  supplementary 
law  of  June  1st,  1891. 

"The  proper  police  authorities  are  empowered  to  compel — 
through  directions  for  individual  enterprises — the  carrying  out 
of  such  measures  as  may  appear  desirable  and  in  the  interest 
of  workmen's  protection,  feasible  of  execution." (2) 

In  addition,  the  Imperial  Insurance  Code  provides  that  "the 
employers'  associations  are  obligated  to  promulgate  the  necessary 
rules  concerning  the  contrivances  and  regulations  which  the 
members  have  to  adopt  for  the  purpose  of  avoiding  accidents 
in  their  establishments."  (3) 

Concession  officials — Police  officials. (4) — Employers'  associa- 
tion. 


(*)     §16  ff.  of  the  Gewerbeordnung. 

(2)     §120  d  of  the  Gewerbeordnung. 

(8)  This  provision  of  §848  of  the  Imperial  Insurance  Code  was  already 
contained  in  the  accident  insurance  law  of  July  6,  1884  (§78)  and  in  the 
industrial  insurance  law  of  June  30,  1900  (§112)  :  "The  associations 
are  empowered  and  can  be  compelled  through  a  system  of  inspection  to 
issue  directions — 1.  Concerning  the  measures  and  rules  to  be  adopted  by 
members  in  their  establishments  for  the  purpose  of  avoiding  accidents 
under  risk  of  incurring  in  case  of  violation,  either  a  money  penalty  of 
1,000  marks  or  of  having  their  establishments  transferred  into  a  higher 
risk  class  or,  in  case  they  are  already  in  the  highest  risk  class,  of  having 
the  amount  of  their  premiums  doubled." 

(4)  In  Prussia,  the  officials  in  charge  of  concessions  are  either  the 
circuit  or  the  city  council  and,  in  the  case  of  a  city  situated  in  a  country 
circuit  and  having  more  than  10,000  inhabitants,  the  mayor  and  alderman 
(collegial  community  board).  In  certain  cases,  the  district  council  acts. 
These  officials  are  authorized  to  hold  investigations  right  on  the  spot,  to 
cite  witnesses  and  experts  and  to  examine  them  under  oath,  in  short,  to 
pursue  all  necessary  investigations  to  the  fullest  extent.  More  particularly, 
these  authorities  ask  for  reports  from  a  building  department  official,  also 

IO 


The  legislator  himself  foresaw  that  this  triple  division  of 
authority  would  lead  to  confusion,^1)  but  experience  alone  has 
shown  how  detrimental  this  "triple  assurance  of  having  the 
workingman  safeguarded"  has  in  reality  proven  to  be. 

To  make  several  bodies  responsible  for  one  and  the  same 
matter  is  contrary  to  one  of  the  elementary  principles  of  correct 
administration.  Not  only  do  the  regulations  thereby  lose  in 
unity,  but  disputes  as  to  jurisdiction  arise,  which  delay  proceed- 
ings and  entail  all  the  evil  consequences  of  "too  much  govern- 
mental red  tape."  How  the  safeguarding  of  the  worker  suffers 
thereby  can  be  easily  seen.  While  the  concession-granting  body 
is  engaged  in  inserting  in  the  terms  of  the  concession  far  reach- 
ing measures  for  the  workers'  protection,  the  activities  of  the 
employers'  association  are  shoved  in  the  background.  At  the 
same  time,  the  employers'  associations  are  accused  of  "not  issu- 
ing sufficiently  complete  directions  for  the  prevention  of  acci- 
dents.'^2). The  response  thereto  is  a  misplaced  competition  be- 
tween the  official  bodies,  a  bureaucratic  race,  as  a  result  of  which 
superfluous  directions  are  issued,  such  as,  for  example :  "Drivers 
of  vehicles  are  not  allowed  to  fall  asleep  while  en  route."  "In 
going  down  hill,  brakes  are  to  be  properly  applied."  "The  use 
of  unsafe  ladders  is  forbidden."  "Workmen  who  have  to  use  a 
hand  or  fore-hammer  must  assure  themselves  before  striking  a 
blow,  that  no  one  is  standing  behind  them,  whom  they  can  hit." 

Quite  rightly  has  one  of  the  most  experienced  exponents  of 
accident  prevention  exclaimed :(3)  "If  we  wish  to  be  honest,  we 
must  admit  that  we  carry  around  with  us,  in  the  form  of  these 
rules,  an  amount  of  ballast  which  we  would  do  better  to  discard 
today  than  tomorrow.  We  ought  to  cease  being  proud  of  this 
humbuggery  and  of  possessing  a  set  of  shadowy  paper  para- 
graphs which  would  minutely  regulate  every  movement  and 
would  turn  each  individual  into  a  puppet;  all  these  are  of  per- 

(1)  — when  it  was  enacted:    "If  the  regulations  (of  the  police)  should 
be  contrary  to  the  directions  issued  by  the  appropriate  employers'  associa- 
tion for  the  prevention  of  accidents,  the  executive  committee  of  the  associa- 
tion is  authorized  to  start  the  necessary  legal  remedies." 

(2)  Proceedings  in  the  Prussian  Ministry  of  Commerce  (November 
23,  1910). 

(3)  Heretical  Idea,s  as  to  Accident  Prevention,  by  Karl  Klein,  mana- 
ger and  technical  inspector  of  Section  I  of  the  Machinery  Employers'  As- 
sociation in  the  Zeitschrift  fur  Gewerbehygiene,  for  1909.  No.  6. 

from  a  factory  inspector  and,  as  a  rule,  also  from  a  health  department 
official.  Finally,  in  certain  cases  the  proper  veterinary  official  must  be 
called  upon  as  one  of  the  reporting  experts. 

If  taken  within  14  days,  an  appeal  is  permissible  from  the  decision 
of  the  concession-granting  board.  The  Minister  of  Commerce  decides  as 
to  these  appeals :  "The  Minister  of  Agriculture  must  be  consulted  in  ad- 
dition, if  the  erection  of  a  dam  is  contemplated,  affecting  in  any  way 
agricultural  interests." 

In  Bavaria,  the  district  authorities  act;  and,  in  Saxony,  the  high  dis- 
trict constabulary  and  the  municipal  council,  etc. 

II 


nicious  import  and  ought  to  disappear.  For  the  increasing 
mania  for  regulating  everything  makes  the  workman  so  depen- 
dent that  he  regards  as  permissible  all  that  is  not  directly  for- 
bidden." 

As  far  as  the  protection  of  the  worker  is  concerned,  how 
much  better  would  it  be  if  a  single  body  assumed  the  entire 
responsibility.  Then  at  a  critical  stage  it  could  n^t  be  said: 
The  employers'  association  is  a  fault  in  this  matter!  No,  the 
police  authorities!  No,  the  concession-granting  officials!  Fur- 
ther, there  should  be  done  away  with  the  many  superfluous 
directions  which  make  it  so  difficult  for  the  workingmen  thor- 
oughly to  familiarize  themselves  with  the  really  necessary 
regulations.  As  a  matter  of  fact  the  safeguarding  of  the  worker 
is  but  little  enhanced  by  this  system  of  "triple  assurance." 

Now  one  might  assume  that — as  the  boards  in  charge  of  the 
granting  of  concessions  were  for  the  most  part  in  a  position  to 
delegate  to  the  police  authorities  or  to  the  employers'  associa- 
tion questions  involving  the  protection  of  the  workingman — the 
procedure  for  obtaining  a  concession  would  have  been  simplified 
to  that  extent.  Nevertheless,  just  the  opposite  has  occurred. 
The  authorities  know  that  they  can  exert  more  pressure  in  com- 
pelling the  adoption  of  such  directions  as  are  incorporated  in 
the  conditions  for  the  granting  of  a  concession  because  the  ap- 
plicant submits  quietly  to  such  conditions  in  order  to  be  able  to 
begin  construction  promptly.  On  the  other  hand,  he  invokes  his 
legal  remedies  against  the  police  regulations.  The  officials, 
therefore  seek,  if  possible,  to  make  all  workers'  protective  meas- 
ures a  part  of  the  proceedings  for  securing  a  concession^1)  But 
this  activity  on  the  part  of  the  concession-granting  boards  does 
not  secure  the  owner  against  further  supplemental  requirements, 
inasmuch  as  the  other  two  "authorized  bodies"  are  in  a  position 
to  demand  supplemental  changes. 

Thus  it  has  happened  that,  in  a  time  of  industrial  progress 
and  international  competition,  a  retrogression  has  taken  place 
in  the  proceedings  for  the  attainment  of  an  industrial  concession. 
The  fundamental  principle  underlying  the  idea  of  industrial  con- 
cessions has  been  forgotten,  as  well  as  the  saying,  which  was 
incorporated  half  a  century  ago  in  a  statement  of  the  reasons 
for  the  adoption  of  an  industrial  code :  namely,  that  the  law- 
makers were  anxious  to  replace  the  police  regulations  which  "are 
so  multiform  and  so  vexatious"  by  a  new  set  of  rules  and  "to 
secure"  those  engaged  in  industrial  pursuits  against  "supplemen- 
tary requirements  and  restrictions." 

The  question  will  now  naturally  be  asked,  is  our  system  of 
legislation  so  ineffectual  that  it  is  unable  to  do  away  with  such 


(*)  Prof.  Bernhard's  lengthy  footnote  at  this  point  is  omitted  be- 
cause it  relates  to  the  interpretation  of  some  technical  provisions  in  the 
German  concession  rules  and  police  regulations  that  would  not  interest 
American  readers. — Translator's  Note. 


12 


patent  defects?  Adequate  and  suitable  proposals  have  indeed 
been  made  by  experts  with  the  object  of  simplifying  and  ex- 
pediting the  system  of  granting  concessions  and  to  accommodate 
it  to  the  requirements  of  the  times.  (x)  The  chemical  industry  es- 
pecially lays  stress  on  the  right  of  proving  by  an  operative  test 
that  the  anticipated  defects — which  stand  in  the  way  of  granting 
a  concession — would  not  in  fact  occur.  In  such  instances,  in- 
dustrial owners  would  run  the  great  risk  of  having  equipped 
their  establishments  to  no  purpose.  This  risk,  however,  they 
regard  as  less  costly  in  the  end  than  the  long  delays  in  granting 
concessions. 

In  addition,  it  has  been  proposed  to  concentrate  the  issuance 
of  accident  preventive  regulations  in  the  hands  of  one  bureau  and 
thus  not  only  to  make  proceedings  for  obtaining  concessions 
easier,  but  also  to  bring  about  uniformity  in  the  methods  of 
guarding  against  accidents. 

Why  do  the  legislative  instrumentalities  pay  hardly  any  atten- 
tion to  these  proposals?  The  answer  to  this  question  is  to  be 
found  herein:  The  parliamentary  situation  makes  the  enact- 
ment of  such  relief  measures  impossible.  The  representatives 
of  the  agricultural  interests  take  the  position  that  the  industrial 
world,  which  has  to  have  regard  in  such  a  marked  degree  to 
social-polity  demands,  should  to  the  same  extent  respect  the 
demands  of  agricultural  interests.  Every  proposed  simplification, 
mitigation  or  acceleration  of  concession  proceedings  are  not 
only  vigorously  opposed  by  the  agricultural  representatives,  but 
steps  are  actually  taken  to  make  the  proceedings  more  compli- 
cated and  difficult.  (2)  Inasmuch  as  the  powers  that  be  both  in 
Social  Democratic  as  well  as  in  Agrarian  political  circles,  make 
more  cumbersome,  the  proceedings  for  industrial  concessions,  and 
obstruct  a  proper  development  of  this  branch  of  administration, 
the  industrial  representatives  find  themselves  in  a  very  difficult 
position.  On  this  question,  they  are  always  opposed  by  a  par- 
liamentary majority,  no  matter  whether  the  subject  of  conces- 


C1)  Thus,  for  example,  it  has  been  proposed  that  experts  from  in- 
dustrial circles  should  take  part  in  the  proceedings.  Again,  on  behalf  of 
those  engaged  in  industry,  attention  was  called  to  the  fact  that  besides  the 
preliminary  permission  to  build  contained,  in  §19  a,  the  permission  to  make 
an  operative  test  would  be  of  great  importance. 

(2)  The  best  example  of  agriculturalist  aims  is  to  be  found  in  the 
"proposition  Spec."  On  February  12,  1907,  Count  Spec  proposed,  on 
behalf  of  the  Centre  Party  and  von  Pappenheim,  on  behalf  of  the 
Conservatives,  first,  that  agricultural  experts  should  take  part 
in  all  proceedings  for  the  grant  of  an  industrial  concession,  and,  secondly, 
that  the  Minister  of  Commerce  should  not  decide  these  matters  solely,  as 
heretofore,  but  "in  conjunction  with  the  Minister  for  Agriculture,  Domains 
and  Forests."  This  impeding  of  concession  obtaining  methods  was  always 
to  occur  whenever  "agricultural  interests  would  be  affected  by  the  author- 
ization of  the  industrial  establishment."  In  spite  of  the  determined  op- 
position of  the  Minister  of  Commerce,  the  proposition  was  accepted  by 
the  house  of  representatives,  but  rejected  by  the  government. 

13 


sions  is  discussed  in  the  Reichstag,  which  has  jurisdiction  of 
matters  arising  under  the  industrial  code,  or  in  the  Landtag, 
which  has  to  be  consulted  in  reference  to  the  Prussian  "directions 
for  carrying  out  the  law."  Almost  all  the  present  existing  dif- 
ficulties are  to  be  traced  to  the  unfavorable  political  situation  in 
which  the  industrial  interests  find  themselves.  Not  only  are  the 
regulations  for  the  grant  of  concessions  themselves  affected  by 
the  power  of  the  political  majority,  but  their  interpretation  is  in- 
fluenced by  the  groupings  of  the  parliamentary  factions. 

It  is,  therefore,  by  no  means  proper,  as  in  fact  so  often  occurs, 
to  hold  certain  individuals  or  certain  groups  of  officials  re- 
sponsible for  the  condition  of  affairs,  and  to  blame  them  for  being 
"hostile  to  industry"  and  for  pettifogging.  There  is  not  the 
slightest  reason  for  doubting  that  the  officials  entrusted  with  the 
execution  of  the  laws,  especially  the  factory  inspectors,  endeavor 
to  be  impartial  and  desire  to  act  conscientiously  and  with  con- 
sideration. Leaving  everything  personal  aside,  the  following 
ought  to  be  borne  in  mind : 

The  officials  have  to  take  into  account  the  provisions  of  the 
law,  which  they  cannot  circumvent.  They  are  allowed  to  exer- 
cise— and  that  is  the  kernel  of  the  matter — "independent  dis- 
cretion." Nor  does  this  mean  a  limited  range  of  action.  For 
example,  §25  of  the  industrial  code  provides  that  the  reap- 
proval  of  a  concession  is  in  order  "when  there  have  been  ap- 
preciable changes  in  the  operating  methods."  The  officials  are 
called  upon  to  decide  in  each  separate  case  what  are  to  be  deemed 
"appreciable  changes."  An  attempt  has  been  made  to  limit  the 
scope  of  this  activity  and  the  Prussian  court  of  appeals  has  tried 
in  several  instances  to  define  or  to  circumscribe  the  term  "ap- 
preciable changes."  But  the  law  courts  finally  left  it  "to  the 
judgment  of  the  officials  to  be  exercised  in  conformity  with  their 
oath  of  office  to  decide  whether  the  reapproval  of  a  concession 
was  in  order  or  not.'X1)  At  other  stages  in  the  proceedings  for 
obtaining  the  approval  of  a  grant,  and  indeed  just  at  the  critical 
points  (examinations  of  foundation  plans,  determination  of  con- 
ditions), the  officials  are  allowed  a  wide  scope  within  which  to 
exercise  their  judgment.  No  one,  no  matter  whose  interests  he 
may  be  called  upon  to  represent,  could  entertain  the  idea  of  abol- 
ishing this  official  freedom  of  action,  which  allows  the  "interests 
affected"  space  to  turn  around  in.  These  would  suffer  if  a 
"strict  letter  of  the  law"  interpretation  were  adhered  to.  What 
are,  however,  the  "interests  affected"?  In  answering  this  ques- 
tion, the  officials  are  consciously  or  unconsciously  influenced  by 
the  public  sentiment,  which  has  come  to  assert  itself  most 
strongly.  Even  though  the  Minister  of  Commerce,  who  has  the 
final  say  in  matters  affecting  concessions,  should  be  ever  so  de- 

0)  Cf .  on  this  point,  Tittler :  "The  Efforts  to  Bring  about  a  Change  in 
the  Methods  of  Approving  Concessions  for  Industrial  Establishments,"  in 
the  periodical  Sozialtechnik  for  1911,  No.  9. 

14 


sirous  of  helping  the  growth  of  industry,  he  has  always,  as  a 
member  of  the  ministry,  to  include  the  influential  parties  in  his 
reckoning.  Even  though  the  industrial  privy  councillor  should 
endeavor  to  act  altogether  conscientiously,  he  will  nevertheless — 
perhaps  involuntarily — advocate  views  which  will  coincide  with 
those  of  the  prevailing  political  groups.  And  even  if  all  the  in- 
calculable and  unassailable  political  influences  were  removed  to- 
day, the  tendency  of  the  times  would  yet  remain  to  exert  an 
active  influence.  Fifty  years  ago  this  influence  was  struggling 
towards  liberty  of  action  and  for  industrial  freedom ;  but  nowa- 
days— influenced  by  the  course  of  social  development — it  is  laying 
stress  on  the  "needful  interference  of  the  state." 

Whoever  considers  all  these  factors,  the  loading  down  of  the 
proceedings  for  obtaining  the  grant  of  a  concession  with  social- 
polity  requirements,  the  delays  caused  by  agrarian  political  con- 
siderations and  finally  the  unavoidable  tendency  of  the  times, 
which  affects  the  independent  judgment  of  the  officials — whoever 
considers  all  these,  will  not  deem  it  a  matter  of  passing  occurrence 
should  he  perceive  that  proceedings  for  the  obtaining  of  a  con- 
cession have  become  more  and  more  difficult,  complicated  and 
protracted.  He  will  not  be  astonished  to  learn  that  industrial 
owners  have  to  wait  eight  months  as  a  rule  before  their  conces- 
sions are  granted (*)  and  cannot  commence  construction  until  after 
the  competing  English  plants  have  been  long  in  operation.  Nor 
will  he  be  amazed  to  hear  that  the  approval  of  applications  is  made 
dependent  on  improper  conditions  or  such  as  even  cannot  be 
performed,  and  that  the  records  in  a  case  grow  in  the  end  into  a 
mound  of  documents  in  which  are  recited  a  multitude  of  condi- 
tions, covering  from  30  to  40  separate  paragraphs. 


CHAPTER  II. 

GOVERNMENTAL  SUPERVISION  OF  PRIVATE  INDUSTRIAL  ENTERPRISES. 

So  long  as  there  were  no  officials  to  supervise  the  execution 
of  the  laws,  social-polity  legislation  existed  only  on  paper.  Ever 
since  the  time  factory  inspection  was  first  introduced  in  England 
in  1833  all  other  industrial  countries  have  met  with  the  same 
experience. 

Germany  possesses  today  a  system  of  factory  inspection  which 
can  be  compared  in  all  confidence  with  the  system  in  vogue  in 
England.  To  be  sure,  it  is  not  easy,  indeed  it  is  scarcely  possible — 


0)  Many  cases  occur  in  which  proceedings  for  a  concession  last  for 
more  than  a  year,  indeed  more  than  V/2  years. 

All  the  indications,  therefore,  point  to  the  same  conclusions,  namely, 
that  the  involved  proceedings  for  attaining  governmental  approval  of  new 
private  industrial  enterprises  have  become  a  veritable  danger  for  the  com- 
peting power  of  German  industry. 

15 


for  no  comparable  figures  are  in  existence (*) — to  make  an  effect- 
ive comparison  between  international  methods  of  factory  inspec- 
tion. But  whoever  may  happen  to  read  the  factory  inspection 
reports  published  by  various  nations  cannot  fail  to  be  convinced 
that  the  German  system  of  inspection  is  carried  out  more  care- 
fully and  thoroughly  than  that  of  any  other  country.  In  making 
this  statement,  I  am  only  considering  the  actual  contents  of  the 
reports  and  am  not  taking  into  account  the  much  greater  number 
of  inspectors  relatively  speaking  to  be  found  in  the  German  Em- 
pire. A  knowledge  and  discernment  of  details  appears  in  the 
German  reports,  which  far  exceed  the  simple  determination  of 
the  fact  whether  the  laws  are  being  observed  or  not.  On  the 
other  hand  the  reports  appearing  in  most  other  countries  are  con- 
fined in  the  main  to  a  statement  of  the  manner  in  which  the  laws 
are  observed.  With  this  conclusion,  the  observations  of  German 
engineers  employed  abroad  coincide,  and  often  one  hears  with 
what  astonishment  the  great  difference  is  noted  between  the  dis- 
creet control  exercised  by  the  factory  inspectors  in  England  and 
the  intrusive  examination  customary  in  Germany.  Indeed,  the 
German  inspectors  go  so  far  in  their  zeal  for  examination  that 
they  sometimes  even  cause  misgivings  to  arise  among  the  work- 
men. Thus  for  example,  all  the  Prussian  factory  inspectors 
started  an  inquiry  into  whether  the  workmen  had  breakfasted 
before  beginning  work  or  not. 

The  outcome  of  this  investigation  was  not  altogether  certain, 
because  the  workers — "often  from  a  false  sense  of  shame,"  as  an 
industrial  privy  councillor  remarked — "resented"  such  an  intru- 
sion into  their  private  affairs  and  "hesitated  to  give  to  others  an 
insight  into  their  household  matters."  When  the  foremen  were 
then  applied  to,  they  "very  frequently  refused  to  give  any  infor- 
mation on  the  ground  that  they  did  not  consider  it  advisable  to 
mix  themselves  in  such  personal  matters  of  their  workmen." 

The  question  may  be  left  undecided  whether  it  would  really 
have  marked  a  step  in  advance  from  a  social  standpoint  if  the 
workmen  had  laid  aside  their  "false  sense  of  shame,"  and  had 
expressed  themselves  freely  upon  the  question,  to  what  extent  the 
matter,  "in  the  case  of  those  married,  depended  on  the  wife's 
capabilities."  At  least,  the  inquiry  enables  one  to  perceive  the 
zeal  for  regulation  displayed  by  the  higher  Prussian  factory  in- 
spection officials. 

Alongside  of  the  control  exercised  by  the  factory  inspectors, 
a  system  of  regulation  by  written  documents  has  grown  up  in 
the  course  of  time,  which,  with  its  "notices,"  "schedules"  and 
"statistical  information,"  "forms  a  triple  extension  of  factory  in- 
spection methods." 

For  example — to  describe  the  form  of  "notice" — if  the  em- 

0)  Nevertheless,  the  following  figures  may  be  of  interest:  In 
England  there  is  one  inspector  for  every  23,000  miners,  in  Prussia  one  in- 
spector for  every  3,430  miners. 

16 


ployer  intends  to  employ  women  or  children,  he  is  obliged  to 
make  out  a  written  notice  before  the  employment  begins.  In 
this  notice  there  has  to  be  stated  the  kind  of  establishment,  the 
week  days  on  which  the  intended  employment  is  to  take  place,  the 
time  when  work  is  to  begin  and  to  cease  and  the  rest  hours  in 
between,  as  well  as  the  nature  of  the  employment.  This  docu- 
ment has  to  be  handed  to  the  local  police,  which  transmits  it  then 
to  a  factory  inspector.  The  latter  sees  whether  the  notice  con- 
tains all  the  prescribed  information  and,  if  such  be  not  the  case, 
he  causes  it  to  be  made  complete.  Finally,  the  notice  is  returned 
to  the  police  authorities.  Then,  as  is  stated  in  the  directions  for 
enforcement,  the  inspector  has  to  notify  the  employer  in  writing 
that,  in  the  rooms  where  women  or  children  are  employed,  an 
extract  from  the  provisions  of  the  industrial  code  must  be  posted 
and,  in  the  rooms  where  children  are  employed,  a  copy  of  the 
"notice"  which  was  transmitted  to  the  police  in  addition. 

The  activity  of  the  officials  does  not  stop  there,  however.  For 
the  first  mentioned  extract,  the  employer  has  to  make  use  of 
Form  "N,"  and  for  the  second  notice,  of  Form  "O."  There  are 
certain  kinds  of  establishments,  however,  for  example,  motor  ve- 
hicie  factories,  for  which  Forms  "R"  and  "S"  are  prescribed  in 
place  of  Form  "N."  Other  workshops  call  for  the  use  of  Forms 
"T"  and  "U,"  and  finally  there  are  others  that  require  the  choice 
of  Forms  "V"  and  "W." 

The  foregoing  should  be  well  noted!  Thus  it  has  come  to 
pass  that  the  employer  is  not  only  supervised  by  the  police  author- 
ities and  the  factory  inspectors,  but  that  an  indirect  control  by 
the  workmen  themselves  occurs  in  addition.  These  are  able  to 
watch  whether  the  statements  made  in  the  posted  "placards"  are 
in  reality  true  or  not.  The  law,  therefore,  has  expressly  provided 
that  the  placard  must  be  posted  in  a  workshop  "at  a  place  where 
it  is  likely  to  attract  the  eye." 

Methods  of  control  having  thus  been  carefully  provided  for, 
the  employer  is  not  allowed  to  change  the  stated  hours  (whether 
hours  of  work  or  rest  hours),  but  is  obliged — if  business  makes 
an  increase  or  a  shortening  of  the  number  of  working  hours  ne- 
cessary— to  make  out  a  new  "notice"  concerning  the  proposed 
change,  in  which  event  the  same  formalities  have  to  be  gone 
through  with. 

This  suffices  for  the  "notice."  A  milder  form  of  written 
regulation  is  the  "schedule."  Thus,  for  example,  if  the  employer 
desires  to  have  certain  kinds  of  work  carried  out  on  Sunday  which 
cannot  be  deferred  to  some  other  day  (urgent  repairs,  certain 
kinds  of  cleaning,  etc.),  he  has  to  start  a  "schedule"  in  which 
there  has  to  be  carefully  set  out  the  number  of  workmen  em- 
ployed, the  time  for  which  they  were  employed  as  well  as  the  na- 
ture of  the  work  carried  on.  The  statement  has  to  be  made  out 
in  so  detailed  a  form  that  the  official  who  has  oversight  of  the 
matter  can  tell  from  the  statement  itself  whether  the  work  per- 

17 


formed  was  of  such  a  nature  that  it  could  not  be  deferred.  The 
"schedule"  is  to  be  so  kept  (Form  "J")  that  one  can  see  on 
glancing  at  it  all  work  of  this  kind  which  has  been  undertaken  in 
the  course  of  the  calendar  year. 

Alongside  of  these  two  carefully  prescribed  forms  of  written 
regulation,  a  third  form  exists — the  "statistical  information" — 
which  is  left  to  the  officials  to  determine.  The  employers  are 
obliged  to  give  the  factory  official  or  the  police  authorities  "such 
statistical  information  concerning  the  situation  of  their  workmen 
as  may  have  been  prescribed  by  the  Bundesrat  or  the  Landeszen- 
tralbehorde.'X1) 

The  South  German  Volkspartei  was  the  only  party  which 
early,  but  in  vain,  sought  to  check  the  flow  of  ink  which  streams 
from  these  three  sources.  In  a  very  effective  speech  delivered 
in  the  Reichstag,  Payer — one  of  its  members — took  exception 
twenty-one  years  ago  to  the  excessive  amount  of  written  regula- 
tion. "Does  not  that  which  has  already  been  imposed  on  the 
employer  suffice?"  exclaimed  Payer.  "Has  not  the  moment  ar- 
rived when,  instead  of  merely  thinking  of  safeguarding  the 
worker,  one  ought  also  to  consider  protecting  the  manufacturer 
against  such  tasks  and  burdens  which,  in  my  opinion  at  least, 
could  be  dispensed  with?" 

Such  an  impression  was  made  by  Payer's  speech  that  a  ma- 
jority of  the  Reichstag  applauded  him  and  it  almost  appeared  as 
though  one  of  the  new  "written  regulations"  which  had  been  ap- 
proved in  committee  would  be  rejected  by  the  Reichstag  when  in 
full  session.  (2) 

Only  through  an  unsual  combination  of  statesmen  was  it  pos- 
sible to  overcome  the  effect  of  this  speech.  The  Prussian  Minister 
of  Commerce,  Baron  von  Berlepsch,  and  the  leader  of  the  Social 
Democrats,  August  Bebel,  opposed  Payer's  proposition,  and,  as 
the  third  member  of  the  combination,  appeared  the  parliamentary 
head  of  the  great  industrial  interests,  Baron  von  Stumm.  Stumm 
feared,  at  the  time,  that  if  the  system  of  written  regulations  were 
done  away  with,  the  official  boards  would  then  endeavor  to  make 
the  consent  of  the  police  authorities  requisite  for  the  performance 
of  any  extra  work.(3)  Stumm's  attitude,  therefore,  was  assumed 
purely  from  tactical  reasons.  On  the  other  hand,  the  speeches 
of  the  Prussian  government  representatives  and  of  the  leader 
of  the  Social  Democrats  showed  in  their  general  tendency  a  very 
characteristic  conformity.  August  Bebel,  as  well  as  the  speaker 
for  the  government,  acknowledged  that  they  regarded  the  "sched- 
ule" not  only  as  a  method  of  regulation,  but  also  as  a  means  of 


C1)     §139  b  of  the  Gewerbeordnung. 

(2)  The  Volkspartei  had  proposed  to  strike  out  §105  c,  clause  2,  con- 
cerning the  "schedule."     Reichstag  debates  of  February  14  and  16,  1891. 

(3)  The  government  representative  had  indeed  threatened  to  do  this 
after  the  great  impression  produced  by  Payer's  speech. 

18 


exerting  pressure.  The  inconvenience  caused  by  it  was  to  induce 
the  employer  to  desist  as  much  as  possible  from  all  work  out  of 
regular  hours.  Bebel,  therefore,  considered  the  "schedule"  to 
be  entirely  too  mild  in  form  and  advocated  with  all  his  power  the 
introduction  of  police  lists.  (J) 

Here  is  an  instance  where  one  can  clearly  observe  how  even 
the  fundamental  principles  of  government  administration  are 
affected  by  social  policies.  If  the  carrying  out  of  administrative 
formalities  causes  annoyance  and  trouble,  it  is  generally  con- 
sidered as  an  indication  of  bureaucratic  shortcomings.  The 
principle,  therefore,  usually  laid  down  is  that  all  formalities 
should  be  carried  out  with  the  least  possible  amount  of  trouble 
or  red  tape.  However,  this  elementary  principle  of  government 
administration  is  set  aside  by  the  exigencies  of  social  politics. 
As  soon  as  an  administrative  requirement  has  the  secondary  aim 
of  bringing  pressure  to  bear  in  a  given  direction,  the  desire  to 
simplify  and  facilitate  its  execution  disappears.  The  inconven- 
ience suffered  is  intended  to  produce  an  effect.  The  annoyance 
which  has  to  be  undergone  is  just  what  is  expected  to  cause  the 
employer  to  desist  from  undertaking  any  unusual  work. 

If  one  consider  merely  social-polity  aims,  this  method  can 
doubtless  be  defended.  Indeed,  fineness  and  subtlety  can  justly 
be  ascribed  to  this  arrangement.  On  the  other  hand,  however,  it 
should  not  be  overlooked  that  through  the  introduction  of  this 
new  principle  everything  of  a  bureaucratic  and  pettifogging  na- 
ture in  administrative  methods  is  furthered  and  aided.  An  offi- 
cial who  takes  his  time  in  attending  to  formalities,  finds  fault  with 
every  little  trifle  and  delights  in  requests  for  further  particulars, 
can  quiet  his  conscience  with  the  thought  that  it  is  one  of  the 
"secondary  purposes"  of  his  bureaucratic  employment  to  frighten 
off  the  employer  from  undertaking  any  extra  work.  This 
"frightening  off  theory"  influences  also  the  best  of  the  officials. 
It  injures  the  character  of  government  administration ;  and  an  es- 
pecial danger  lurks  therein,  that  the  branch  of  administration 
affected  is  just  the  one  which  is  the  means  of  connecting  the 
government  with  the  pulsating,  industrial  world. 

The  danger  is  also  enhanced  by  this  fact,  namely,  that  bureau- 
cratic tendencies  are  reinforced  by  the  efforts  of  the  socialists, 
who  are  always  endeavoring  to  place  industrial  undertakings 
more  and  more  under  official  control.  Thus  Hue,  one  of  the 
Social  Democratic  members  of  the  Reichstag,  requested  the  im- 


C1)  Bebel  proposed  that  the  employer  should  be  compelled  to  furnish 
the  authorities  with  a  copy  of  the  "schedule"  at  the  end  of  every  month. 
Payer  observed  as  to  this:  "You,  gentlemen,"  (turning  to  the  Social 
Democrats)  "are  the  ones  who  are  calling  for  the  police.  *  *  *  That  agent 
of  government  administration  who,  on  account  of  his  functions,  is  obliged 
to  intrude  in  matters  affecting  industry,  you  term,  when  this  intrusion  is 
distasteful  to  you,  servant  of  the  police ;  whenever  this  intrusion  is  agree- 
able to  you,  he  is  Mr.  Inspector." 

19 


perial  government  during  the  session  held  on  February  6th, 
1906,  to  have  a  statistical  inquiry  made  concerning  the  hours  of 
labor  required  and  the  overtime  incurred  in  the  larger  iron  mak- 
ing establishments.  The  Reichstag  eagerly  accepted  this  sug- 
gestion, and,  on  February  13th,  1906,  passed  a  resolution  calling 
on  the  Imperial  Chancellor  to  start  the  necessary  statistical  in- 
quiries. After  the  matter  had  been  carefully  considered  and  in- 
formation gathered  through  proposed  drafts  how  such  an  inquiry 
was  to  be  carried  out  and,  after  the  Reichstag  had  twice  admon- 
ished the  government  (during  the  discussion  of  the  budget  for 
the  years  1907  and  1908),  the  Bundesrat  finally  issued  an  ordi- 
nance on  December  19th,  1908,  which  provided  as  follows:  In 
the  various  large  iron  establishments,  schedules  were  to  be  kept  in 
which  the  names  of  all  workmen  were  to  be  entered,  who  were 
employed  beyond  the  regular  working  hours.  For  each  individ- 
ual workman,  there  was  to  be  noted : 

1.  The  number  of  usual  working  hours,  and 

2.  The  number  of  hours  of  overtime  occurring  each  day. 
At  the  end  of  every  month,  the  schedule  was  to  be  transmitted 

to  the  local  police. 

An  idea  of  the  excessive  amount  of  writing  caused  by  this 
ordinance  can  perhaps  be  obtained  simply  by  glancing  at  the 
annexed  formulas^1)  In  the  large  establishments,  where  many 
hundred  or  even  several  thousand  workmen  are  employed,  the 
keeping  of  these  schedules  has  become  a  permanent  source  of 
trouble,  more  especially  because  requests  for  further  informa- 
tion are  often  necessary  in  order  to  determine  through  the  fore- 
man whether  "overtime"  really  took  place  in  a  given  case  or  not. 

But  this  sort  of  checking  system,  although  it  goes  into  such 
minute  details — gives  no  idea  of  the  real  conditions  existing.  In 
order  to  keep  the  large  establishments  up  to  the  mark,  certain 
repair  and  cleaning  work  must  be  regularly  undertaken  on  Sun- 
days. For  the  performance  of  this  work,  certain  workmen  are 
employed  who  are  allowed  a  corresponding  period  of  rest  during 
the  week  days.  Their  Sunday  work,  therefore,  cannot  be  termed 
"overtime  work"  in  the  sense  of  calling  for  a  long  protracted 
period  of  work,  and,  as  a  matter  of  fact,  has  never  been  con- 
sidered as  "overtime,"  even  by  the  workmen  themselves.  Never- 
theless, the  ordinance  of  the  Bundesrat  requires  that  these  figures 
should  appear  in  the  "schedule  of  overtime."  According  to  my 
researches,  this  regular  form  of  work  constituted  from  70  to  75 
per  cent  of  the  reported  "hours  of  overtime."  Thus  the  actual 
number  of  hours  of  overtime  shrinks  to  25  or  30  per  cent  of  the 
total  hours  reported.  Even  the  hours  remaining,  however,  do 
not  give  a  picture  of  the  real  condition  of  affairs,  for  no  account 


C1)  See  post,  pages  21  to  23.  With  some  slight  changes,  these 
forms  are  taken  from  the  commentary  on  the  Bundesrat's  ordinance  of 
December  19,  1908,  prepared  by  Government  and  Industrial  Privy  Coun- 
sellor. Opperman. 

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Number 


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21 


Establishment :  Martinwerk 


Month  of  April  1912  (10  days  only) 


1 

2 

3 

4 

5 

Allotted 
Number 

Name  of 
Workman 

1. 

2. 

3. 

(4.) 

5. 

6. 

7. 

8. 

(9.) 

1( 

T. 

). 

N. 

No.  of 
Shifts 

Over 

Week- 
days 

time 
Sun- 
days 

T. 

N. 

T. 

N. 

T. 

N. 

T. 

N. 

T. 

N. 

T. 

N. 

T. 

N. 

T. 

N. 

T. 

N. 

Remarks : 

1.  Entries  in  regard  to  Sundays  and  holidays — marked  by  brackets 
above — are  to  be  made  in  red  ink. 

2.  A   subdivision   for   each   day   occurs   under   column   3,   which   is 
divided  into  T.  and  N.  =  Day  and  Night  shift. 

3.  In  column  6  relating  to  overtime,  a  division  has  been  made  in 
each  horizontal  square.    In  the  upper  half,  overtime  on  week-days,  and 
in  the  lower  half,  overtime  on  Sundays,  is  to  be  entered. 

4.  The  summary  of  columns  5  and  6  of  this  shifts  book  gives  at  once 
the  figures  to  be  filled  in  in  columns  5-13  of  the  "Extract  from  the  wage 
lists"  (§2  Abst.  2  of  the  ordinance  for  larger  iron  establishments). 

5.  Regarding  the  entries  as  to  the  commencement  and  cessation  of 
overtime  hours,  it  is  required  that  the  real  elapsed  period  of  time  be  en- 
tered and  not  merely  an  imaginary  period  (for  the  purpose  of  fixing  and 
estimating  the  extra  wages  to  be  paid  for  overtime  work). 


is  taken  of  the  following  facts,  which  are  of  prime  importance  for 
the  workmen.  In  the  case  of  the  larger  iron  establishments  the 
reporting  of  the  number  of  overtime  hours  is  by  no  means  an 
unfailing  indication  of  business  being  congested  and  the  em- 
ployees overworked.  On  the  contrary,  every  large  establishment 
has  to  count  on  operations  being  almost  daily  interrupted,  and 
this  cannot  be  avoided  under  any  form  of  management.  Thus  in 
a  rolling  mill,  the  failure  of  a  charge  to  come  through  obliges 
the  workmen  to  wait  for  several  hours  until  such  time  as  work 
can  be  resumed,  after  the  replacement  charge  has  worked  down. 
In  this  instance,  only  a  shifting  of  work  takes  place,  to  which  the 
workman  does  not  object,  inasmuch  as  it  results  in  a  considerably 
higher  pay  without  any  increased  exertion.  Yet  the  Bundesrat's 
"schedule  of  overtime"  takes  no  note  of  this  important  distinction. 
Nor  can  it  take  note  of  it,  for  all  phases  of  the  various  pursuits 
involved  can  never  be  covered  in  a  single  form  devised  primarily 
for  purposes  of  control. 


22 


FORMULA  B, 


Up  to  1 
Hour 

More  Than 
1-2  Hours 

How 
More  Than 
2-3  Hours 

"  Many  Times 
More  Than 
3-4  Hours 

Overtime  Occu 
More  Than 
4-5  Hours 

rred 
More  Than 
5-6  Hours 

More  Than 
6-7  Hours 

More  Than 
7  Hours 

: 

CHAPTER  THREE. 

GOVERNMENTAL  REGULATION  OF  PRIVATE  INDUSTRIAL  ENTERPRISES. 

No  proof  is  needed  of  the  difficulty  of  drawing  official  regula- 
tions so  as  to  fit  all  varying  forms  of  industrial  conditions.  For 
example,  one  need  only  glance  at  the  regulations  concerning  the 
observance  of  the  Sabbath  day  rest  to  see  how  phrases  have  to  be 
turned  and  twisted  in  order  to  express  all  that  is  desirable  and 
necessary. 

First  there  is  the  underlying  principle :  Everyone  is  at  liberty 
to  work  when  he  pleases,  for  that  is  "a  matter  in  which  entire 
freedom  of  agreement  is  permitted."  (§105). 

To  this  there  is  a  general  exception,  namely,  that  workmen 
cannot  be  compelled  to  work  on  Sundays  (§105a).  In  addition, 
there  is  a  special  sort  of  exception,  namely,  that  in  certain  kinds 
of  occupations  workmen  are  not  allowed  to  be  employed  on  Sun- 
days. 

These  two  exceptions  in  turn  are  subject  to  four  exceptions: 

1.  In  certain  instances,  enumerated  in  detail  in  §105c,  work 
can  be  carried  on  Sundays  without  the  especial  consent  of  the 
authorities. 

2.  In  certain  occupations  "which  on  account  of  their  nature, 
do  not  permit  of  an  interruption  of  operations,"  the  Bundesrat  is 
permitted  to  allow  an  exception  to  be  made  concerning  the  rule 
for  the  observance  of  the  Sabbath  (§105d). 

3.  In  certain  occupations,  "the  carrying  on  of  which  is  neces- 
sary to  meet  the  daily  wants  of  the  people,"  the  Regierungspresi- 
dent  is  allowed  to  grant  an  exception  (§105e). 

4.  In  the  case  of  certain  kinds  of  work  required  "to  prevent 
a  disproportionate  amount  of  damage,"  the  local  police  can  allow 
an  exception  (§105f). 

Again,  to  the  above  exceptions  1  to  3  there  is  a  condition: 
Even  if  work  on  Sunday  is  permitted  in  certain  cases,  the  work- 
man must  have  every  third  Sunday  free  (§105c,  Subdiv.  3). 

23 


To  the  above  condition,  however,  the  following  exceptions 
apply: 

1.  A  general  exception  that  if  the  work  on  Sundays  does 
not  last  for  more  than  three  hours  the  workmen  may  be  employed 
"on  every  third  Sunday/' 

2.  A  special  exception,  that  if  the  workmen  are  allowed  a 
24-hour  rest  period  on  a  week  day,  the  police  authorities  can  allow 
them  to  be  also  employed  on  a  "third  Sunday"  (§105c,  Subdiv.  4). 

It  is  thus  that  the  commandment,  "Thou  shalt  observe  the  Sab- 
bath day/'  is  stated  in  the  language  of  the  law ! 

Whoever  studies  these  or  similar  contortions  of  paragraphs 
may  perhaps  be  too  easily  inclined  to  blame  our  system  of  factory 
regulation,  which  has  been  termed  "a  checkered  system  of  excep- 
tions." But  as  soon  as  one  reads  about  the  causes  at  work  and 
examines  the  records  for  several  decades  back  and  determines 
word  for  word  how  everything  has  come  to  pass,  it  is  self-evident 
that  sagacious  men  have  laboriously  and  in  the  course  of  years 
thought  out  the  present  system.  Not  neglect  of  any  kind  or  bu- 
reaucratic whims  are  at  the  bottom  of  the  trouble,  but  the  vital 
difficulties  are  to  be  found  in  the  subject  matter  itself.  Of  course, 
everyone  knows  that  the  safeguarding  of  the  workingman  and 
the  protection  of  life  and  health  cannot  be  carried  out  without 
some  government  regulation  and  that  the  German  workingmen's 
protective  legislation  has  brought  about  an  immense  amount  of 
good.  Nevertheless,  it  will  never  be  possible  to  come  to  a  definite 
determination  as  to  how  far  the  state  ought  to  interfere  with  its 
system  of  regulations.  Theory  and  practice  will  always  be  in 
uncertainty  as  to  where  should  be  drawn  the  line  beyond  which 
one  should  not  go. 

This  constant  state  of  uncertainty  leads  naturally  to  a  never 
ending  contest  of  parties.  No  doubt  exists  any  longer  that  the 
line  is  being  drawn  more  and  more  on  the  side  of  governmental 
regulation.  Every  political  party  is  desirous  of  producing  results 
in  matters  of  social  legislation ;  and  the  great  parties,  which  are 
dependent  on  the  support  of  the  workingmen  at  election  times, 
have  to  show  at  every  parliamentary  session,  that  they  deserve 
the  support  of  the  masses.  It  is  for  this  reason  that  the  govern- 
ment is  overwhelmed  year  after  year  with  resolutions  and  propo- 
sitions calling  for  more  and  more  governmental  interference. 

Under  such  conditions,  it  was  quite  in  the  natural  course  of 
events  for  governmental  regulation  to  have  gradually  turned  from 
matters  of  general  import — which  had  already  been  definitely  dis- 
posed of — (protection  of  women  and  child  workers,  rest  on  Sun- 
days, etc.)  to  matters  affecting  the  operation  of  industrial  enter- 
prises. As  we  have  seen,  it  is  was  difficult  enough  to  find  a 
satisfactory  form,  which  the  industrial  world  could  tolerate,  for 
the  simple  and  desirable  ordinance  regulating  work  on  Sundays. 
But  it  is  extremely  dangerous  if  the  law  goes  too  deeply  into  mat- 

24 


ters  affecting  more  particularly  the  operation  of  industrial  enter- 
prises, such,  for  example,  as  the  regulation  of  rest  periods. 

Whoever  has  read  the  social  polity  debates,  which  have  oc- 
curred in  the  Reichstag  during  the  last  six  years,  will  find  that 
"regulation  of  the  hours  of  rest"  plays  an  important  part  therein. 
The  general  tone  of  the  discussions  has  been  set  by  the  members 
of  the  Social  Democratic  group  and  eagerly  followed  by 
the  representatives  of  the  other  parties.  The  train  of  thought 
has  been  indeed  very  plain  and  enlightening.  The  accord- 
ing of  sufficient  and  suitably  divided  rest  periods  was  deemed 
of  more  importance  than  the  shortening  of  the  hours  of  labor  or 
the  installation  of  certain  sanitary  appliances.  This  should  be 
a  proper  field  for  state  intervention.  Soon  it  appeared  as  a  quite 
generally  assumed  fact  among  the  representatives  of  the  people 
that  there  could  be  nothing  more  harmless  or  more  natural  than 
the  "regulation  of  the  periods  of  rest." 

In  accordance  with  this  idea,  an  ordinance  was  issued  which 
officially  regulates  the  rest  hours  in  the  large  iron  establishments, 
as  follows:^1)  If  the  number  of  working  hours  exceeds  8,  every 
workman  must  be  allowed  at  least  two  hours  of  rest.  One  of 
the  rest  periods  must  be  at  least  one  hour  long  and  must  occur 
"between  the  end  of  the  fifth  and  the  beginning  of  the  ninth 
working  hour."  "Interruptions"  in  works  of  less  than  15  minutes* 
duration  are  not  to  be  deemed  rest  periods.  The  higher  adminis- 
trative officials  can  allow  certain  exceptions  to  these  rules  to  be 
made  under  certain  circumstances.  But  the  length  of  the  pre- 
scribed two-hour  rest  period  can  be  diminished  only  in  case  the 
interests  of  the  workmen  are  served  by  it.(2) 

In  order  to  prevent  any  evasion  of  this  requirement,  it  was 
expressly  ordered  "that  a  regular,  even  though  it  be  merely  a 
supervising  activity,  cannot  be  imputed  to  the  workmen  during 
the  rest  hours." (8) 

The  state  inspectors,  therefore,  declared  it  inadmissible  that, 
for  example,  a  boiler  tender  should  look  after  the  water  pressure 
during  the  rest  hour.  Indeed,  it  was  even  demanded  that  machine 
and  boiler  tenders  should  leave  the  machinery  house  during  the 
rest  period.  Likewise  the  machinists  employed  on  coke  discharg- 
ing machines  were  directed  to  leave  their  machines  during  the  rest 
hour,  inasmuch  as  their  remaining  near  them  was  to  be  treated  as 
watching  the  machines. (4) 


0)     On  December  19,  1908. 

(2)  "If  consideration  for  the  workmen  makes  this  seem  desirable." 
This  provision  is  intended  to  afford  the  workmen  an  opportunity  of  ob- 
taining a  shortening  of  the  rest  hours  "if  there  is  joined  therewith  a 
corresponding  earlier  dismissal  from  work." 

(3)  Decree  of  January  19th,  1909,  of  the  Prussian  Minister  of  Com- 
merce. 

(4)  These  demands  were  made  despite  the  fact  that  during  the  rest 
hour  the  boiler  fire  was  banked  and  the  steam  pressure  reduced  to  the 
equivalent  of  one  or  two  atmospheric  pressures. 

25 


Severe  demands  were  made  of  blast  furnace  and  hot  metal 
furnace  owners.  When  the  industrial  heads  then  called  attention 
to  the  fact  that  the  regulations  were  impossible  of  execution  and 
constituted  a  grave  danger (*),  the  factory  inspection  service  re- 
plied that  reserve  hands  could  be  provided  to  serve  during  the  rest 
periods.  The  fact  was,  however,  overlooked  that  the  employ- 
ment of  reserve  workmen  has  a  hazardous  moral  effect.  While 
the  shift's  force  formerly  felt  themselves  responsible  for  all  that 
occurred  during  the  time  of  their  shift,  a  part  of  this  respon- 
sibility now  has  to  be  left  to  the  reserve  crew.  Thus  one  shoves 
on  the  other  the  responsibility  for  any  dangerous  neglect  which 
may  have  occurred.  Nor  do  I  intend  to  dwell  on  the  fact  that  it 
is  hardly  ever  possible  to  secure  an  equally  competent  reserve 
force.  It  is  impossible  for  workmen,  who  in  the  course  of  their 
employment  are  called  upon  to  relieve  others  for  half-an-hour  here 
and  for  an  entire  hour  there,  to  possess  the  same  intimate  knowl- 
edge of  or  to  take  the  same  interest  in  their  work  as  the  regularly 
engaged  force.  Under  these  circumstances,  even  the  Prussian 
associations  for  the  inspection  of  boiler  risks  felt  it  necessary  to 
state  their  scruples,  based  on  reasons  of  safety,  against  the  gov- 
ernment method  of  regulating  the  rest  periods. (2) 

It  is  easy  to  understand  why  the  endangering  of  the  safety  of 
operating  methods  should  occupy  the  first  place  in  all  discussions 
concerning  state  regulation  of  workmen's  rest  periods.  But  this 
touches  only  one  side  of  the  question  and  not  the  most  important 
side.  Quite  apart  from  the  matter  of  operating-safety,  the  in- 
troduction of  state  regulation  of  the  rest  hours  marks  an  import- 
ant encroachment  on  the  masters'  liberty  of  action. 

In  order  to  estimate  the  value  of  this  one  should  bear  in  mind 
that  in  the  great  industrial  establishments,  where  from  1,000  to 
10,000  workmen  are  employed,  a  planning  of  work  according 
to  a  fixed  detailed  schedule  is  impossible.  Irregularities  in  oper- 


C1)  Experience  showed,  for  example,  that  in  blast  furnaces  the  tem- 
perature had  doubled  after  an  intermission  of  three-quarters  of  an  hour. 
For  the  temperature  rises,  the  deeper  the  burden  sinks.  After  such 
an  intermission,  it  required  about  three  hours  of  steady  feeding  for  the 
normal  temperature  to  be  attained.  But  through  these  changes  in  the 
temperature,  the  entire  furnace  is  endangered  and  dangerous  repairs,  re- 
quiring much  time,  become  necessary.  Again,  as  a  result  of  the  rapid 
rise  in  temperature  during  the  intermission  hour,  the  air  in  the  furnace 
becomes  of  unequal  density.  As  a  consequence  of  this,  gases  escape, 
which  endanger  the  workmen  when  they  resume  their  work.  Side  by  side 
with  these  changes  in  temperature,  other  undesirable  occurrences  take 
place.  As  a  consequence  of  the  burden  having  sunk  so  low,  the  coke, 
when  the  needful  charge  is  made,  falls  from  an  abnormal  height  and  breaks 
into  pieces.  On  being  dropped  the  same  distance  the  heavy  ores  com- 
pletely disintegrate  the  coke.  Thus  an  unfavorable  mixing  of  materials 
takes  place  which  causes  an  interruption  of  operations.  For  further  details 
see  Matthiae's  interesting  work,  "Observations  concerning  the  rise  of  blast 
furnace  temperatures  during  lengthy  periods  of  intermission." 

(2)  In  this  connection,  a  sharp  difference  of  opinion  arose  between 
the  Prussian  boiler  inspection  associations  and  the  Minister  of  Commerce. 

26 


ation  occur  daily,  which  have  to  be  overcome  by  prompt  and 
dexterous  measures.  A  stoppage  in  one  department  will  influence 
the  running  of  the  whole  plant.  To  be  sure,  if  one  reads  the  state- 
ment which  the  German  Metal  Workers'  Union  has  published  con- 
cerning the  regulation  of  rest  hours  by  the  state, (l)  not  a  word  is 
to  be  found  concerning  the  question  of  freedom  of  action  so  in- 
dispensable in  business  undertakings.  On  the  contrary,  one 
gathers  the  impression  as  though  it  were  possible  to  operate  the 
larger  establishments  with  systematic  exactitude  and  with  every- 
thing divided  off  to  the  last  minute  of  time.  This  impression — 
fathered  by  all  those  who  would  like  to  extend  the  scope  of 
government  regulation — is  perhaps  the  most  dangerous  misconcep- 
tion for  the  future  of  German  industrial  life  which  can  exist.  For 
our  age — which,  under  the  influence  of  social  development,  so 
inclines  to  regulation  by  the  state — has  almost  entirely  lost  the 
belief  in  any  independent  personal  and  individual  initiative. 

Intimately  joined  to  this  state  of  affairs  is  the  effort  to  gradu- 
ally shove  aside  the  self-governing  organizations  which  our  in- 
dustrial world  has  created.  Two  groups  of  such  self-governing 
bodies  are  to  be  considered  in  this  connection :  the  boiler  inspec- 
tion organizations  and  the  employers'  associations.  To  these  the 
law  makers  entrusted  important  functions  because  of  the  convic- 
tion that  a  system  of  direct  government  supervision  would  be  too 
inflexible  and  too  little  susceptible  of  adapting  itself  to  changing 
industrial  requirements.  Nevertheless,  the  government  net  is  al- 
ways being  drawn  tighter  and  tighter  around  these  corporate 
bodies.  For  example,  the  Prussian  Minister  of  Commerce  sharply 
repelled  the  boiler  inspection  associations  when  they  raised  objec- 
tions to  the  government  methods  of  regulating  the  workmen's 
rest  periods  (2)  and  the  employers'  associations  are  not  only  over- 
looked but  are  even  unlawfully  superseded  by  the  government 
officials.  (3) 


X1)  Die  Schwereisenindustrie  im  deutschen  Zollgebiet,  ihre  Ent- 
wickelung  und  ihre  Arbeiter,  published  by  the  executive  committee  of  the 
German  Metal  Workers'  Union.  Stuttgart,  1912,  pages  583-621. 

(2)  In  a  circular  dated  January  10th,  1911,  the  Minister  of  Commerce 
denied  the  right  of  the  central  organization  of  the  Prussian  boiler  inspec- 
tion associations  to  interfere  in  matters  of  social-polity  import.    There- 
upon the  following  reply  was  made:     'The  question  at  issue  (regulation 
of  the  rest  periods)    is  intimately  connected  with  the  safe  operation  of 
boilers.     In  view  of  the  facts  heretofore  ascertained  by  us,  there  can  be 
no  doubt  that  the  application  to  boiler  firemen  of  the  rules  as  to  rest  periods 
results  in  the  safety  of  these  boilers  being  endangered.    Fear  of  the  con- 
sequences gives  the  management  not  only  the  right  to  interfere  in  the 
matter,  but  makes  it  indeed  its  duty.     In  view  of  the  exceptional  im- 
portance which  this  matter  has  for  the  safe  operation  of  boilers  in  the 
establishments  affected,  we  intend  to  make  its  detailed  discussion  one  of 
the  subjects  to  be  brought  up  at  the  next  meeting  of  our  members.     To 
this  the  minister  replied  (April  5th,  1911,)   that  under  no  circumstances 
could  he  allow  an  official  to  take  part  in  the  discussion  and  that  he  was 
not  in  a  position  to  pay  heed  to  any  further  remonstrance. 

(3)  This   is  true,   for  example,  of  the   Oberprasidialverordnung  of 

27 


CHAPTER  IV. 

GOVERNMENT  ACQUISITION  OF  PRIVATE  INDUSTRIAL  UNDERTAKINGS. 

In  1876,  when  the  question  of  government  acquisition  of  the 
railways  had  pushed  all  other  questions  of  internal  politics  into 
the  background,  Wehrenpfennig  wrote: 

"Compared  to  the  conditions  existing  with  us,  conditions  in 
France  are  a  model  of  orderliness.  We  have  63  separate  railway 
managements,  which  consider  themselves  more  or  less  sovereign. 
The  traveler  who  goes  from  Berlin  to  Karlsruhe  has  to  make  has 
to  make  use  of  seven  independent  railway  systems.  Not  even  a 
railway  official — and  much  less  an  ordinary  citizen — is  in  a  posi- 
tion to  find  his  way  correctly  through  the  labyrinth  created  by  the 
1357  existing  tariffs  and  to  calculate  exactly  what  it  will  cost  to 
transport  a  piece  of  freight  from  one  end  of  Germany  to  the  other. 
Conditions  such  as  these  cannot  last.  They  are  just  as  much 
opposed  to  the  requirements  of  traffic  and  to  the  welfare  of  the 
nation,  which  it  is  the  duty  of  the  Empire  to  foster,  as  were 
formerly  the  custom  barriers,  which  shut  off  from  one  another 
the  38  sovereign  states  of  the  old  Bundestag."  (*) 

Only  two  possibilities  existed.  Either  the  numerous  private 
railways  had  to  be  combined  into  a  few  large  railway  systems  or 
the  government  would  have  to  operate  them.  Although  this 
question  was  bitterly  fought  over  at  the  time,  every  one  realizes 
today  that  state  management  of  railways  has  had  a  brilliant  suc- 
cess. France,  whose  railway  systems  we  heard  at  that  time 
praised  as  a  model  of  orderliness,  has  experienced  some  trying 
disillusions  with  its  "mixed"  system  of  operation,  and  in  England, 
since  the  severe  trials  of  the  summer  of  1911,  the  question  of 
state  acquisition  of  railways  is  being  actively  discussed.  In  Ger- 
many, the  matter  was  taken  up  in  time.  In  this  way  the  wasteful 
system  of  railway  speculation,  which  Lasker  described  in  his  his- 


0)     Preussische  Jahrbiicher,  1876,  p.  440. 


July  30th,  1910,  concerning  the  installation  and  operation  of  elevators. 
Concerning  this,  the  Dartmund  Landgericht  on  November  9th,  1911, 
handed  down  the  following  decision :  "The  Oberprasidial  police  ordinance 
has  been  issued  without  the  employers'  associations  having  been  con- 
sulted. It  contains  regulations  concerning  the  installation  and  operation 
of  elevators  in  industrial  and  private  establishments,  regulations,  which  as 
far  as  they  apply  to  industrial  establishments  have  in  view  the  greatest 
possible  protection  of  the  workingmen  against  dangers  affecting  life  and 
health."  According  to  §120e  of  the  industrial  code,  before  such  regula- 
tions are  issued  the  employers'  associations  affected  have  to  be  given 
an  opportunity  of  expressing  themselves  in  a  written  report.  "This  pro- 
vision, which  was  inserted  by  the  Reichstag  in  spite  of  the  objections 
made  by  other  parties,  is,  according  to  the  prevailing  opinion,  not  only  of 
directory,  but  of  mandatory  force.  Consequently,  the  failure  to  cite  the 
employers'  associations  results  in  making  the  ordinances  affected  null  and 
void.  (Cf.  Urteile  des  Kammergerichts  of  December  27th,  1900,  and  of 
November  25th,  1902)."  As  far  as  industrial  plants  were  concerned,  there- 
fore, the  Oberprasidialverordnung  was  declared  null  and  void. 

28 


torical  speech  in  1873,  was  done  away  with.  Today  Prussian  state 
finances  are  firmly  based  on  the  government  enterprises  whose 
cost  runs  into  the  thousand  millions. 

Thus  state  management  in  Germany  made  its  debut  with  a 
striking  success,  which  proved  only  the  beginning.  Encouraged 
by  the  success  of  the  central  government,  the  German  cities  took 
a  hand,  blossomed  forth  as  backers  of  large  industrial  enterprises 
and  achieved  brilliant  results  when  they  themselves  undertook  to 
furnish  water  and  gas  to  consumers  and  to  operate  electric  sys- 
tems on  their  own  account.  Thus  it  was  proven  by  actual  experi- 
ence that  railways  and  street  car  lines  can  be  well  run  and  the 
population  advantageously  supplied  with  gas,  water  and  electric- 
ity by  the  central  government  and  by  the  individual  communes. 

All  of  these  undertakings  have  one  important  feature  in  com- 
mon. They  can  and  have  to  be  organized  on  rigorous  lines. 
Indeed,  they  will  run  all  the  more  smoothly  the  more  one  suc- 
ceeds in  making  uniform  the  methods  of  railway  operation  and 
those  of  furnishing  water,  gas  and  electricity.  The  rigorous — I 
might  almost  say  the  military — discipline  which  the  officials  are 
subject  to  is  of  decisive  importance  for  the  successful  operation 
of  these  undertakings.  Even  the  irregularities  occurring  in  their 
operation  (stoppages  of  operation,  lack  of  a  sufficient  number  of 
cars)  are  of  such  a  nature  that  they  are  best  overcome  by  pre- 
paring for  them  systematically.  (Instructions  to  be  observed  in 
case  of  stoppages  of  operations,  etc.)  In  these  sorts  of  under- 
takings, therefore,  certain  factors  are  required  for  a  successful 
organization  over  which  the  state  can  dispose  fully  as  well,  in- 
deed probably  to  better  advantage  than  private  individuals.  To 
this  should  be  added  the  fact  that  all  these  kinds  of  undertakings 
require  either  the  use,  the  crossing,  the  excavation  or  the  bridg- 
ing of  public  highways,  whereby  a  conflict  of  interest  there  arises. 
This  is  entirely  avoided  as  soon  as  the  central  government  or  the 
communes  carry  out  the  undertaking.  From  the  standpoint  of 
organization,  therefore,  the  state  and  the  communes  are  in  these 
sorts  of  undertakings  certainly  on  an  equal  footing  with  private 
individual  operators^1) 


0)  Undoubtedly,  under  the  pressure  of  modern  municipal  socialism, 
some  cities,  communes  and  districts  have  gone  ahead  too  fast,  and  the  hasty 
absorption  of  new  forms  of  indebtedness  has  often  disturbed  the  security 
markets.  While  the  German  communes  had  772,000,000  marks  of  indebted- 
ness in  1881,  the  debts  of  the  communes  were  5,684,000,000  marks  on  De- 
cember 31st,  1910,  or  about  750,000,000  marks  more  than  the  debt  of  the  Ger- 
man Empire.  The  efforts  made  to  put  the  indebtedness  of  the  communes 
on  a  sound  footing  have  not  yet  come  to  fruition.  The  question  whether 
the  enterprises  undertaken  by  the  communes  pay  or  not  has  been  debated 
in  literary  circles.  Trustworthy  comparisons  are  not  possible  between  all 
the  cities,  because  the  methods  of  bookkeeping  (amounts  written  off, 
etc.)  are  not  the  same  everywhere.  Recently  Max  Andler,  in  a  very 
interesting  work,  "Die  Stadteschulden  in  Frankreich  und  Preussen," 
(Stuttgart,  1911)  has  attempted  a  calculation  of  their  profitableness 
based  on  the  official  statistics  of  indebtedness.  Andler  arrives  at  a  very 
favorable  conclusion  concerning  the  lucrativeness  of  communal  enter- 
prises. 

29 


While  thus  in  our  age  the  movement  for  state  acquisition  of 
private  enterprises  has  made  great  headway  and  has  obtained 
general  public  support,  deep  seated  changes  occurred  in  private 
industry  which  apparently  paved  the  way  for  the  government 
taking  over  new  branches  of  industry.  A  movement  for  concen- 
tration, of  increasing  force  from  year  to  year,  has  been  taking 
place  in  the  private  industrial  world.  Stock  companies  have  been 
formed  which  have  each  absorbed  quite  a  number  of  important 
independent  plants.  The  great  stock  companies  have  in  turn 
joined  in  forming  enormous  industrial  units  and  these  have  finally 
formed  themselves  into  huge  cartels  and  syndicates.  In  place  of 
the  little  tiny  offices  in  which  our  fathers  and  grandfathers  car- 
ried on  their  business,  imposing  administration  buildings  have 
arisen.  In  these,  a  general  manager  holds  the  reins,  surrounded 
by  a  number  of  lesser  managers,  and  below  these,  a  staff  of  offi- 
cials. The  work  of  these  last  appears  to  be  quite  similar  to  the 
work  performed  by  the  government  officials  in  the  administration 
buildings  of  the  railways  and  of  the  post  office  department.  A 
form  of  organization  has  developed  with  the  resultant  acquisition 
of  certain  bureaucratic  features  by  private  industry.  Thus  the 
great  industrial  combinations  seem  to  work  in  the  direction  of 
and  to  prepare  the  way  for  government  ownership.  What  can  a 
single  individual  accomplish  nowadays  among  the  elaborate 
mechanisms  which  technical  and  economic  changes  have  created  ? 

The  answer  to  this  question  is  by  no  means  so  simple,  how- 
ever, as  has  been  assumed  in  the  theoretical  study  of  political 
economy.  It  seems  almost  as  though  the  theorists  had  become 
intoxicated  with  the  idea  that  socialistic  ideals  were  being  realized 
through  the  grouping  into  cartels  of  the  great  industrial  com- 
binations and  through  their  having  created  a  bureaucratically 
arranged  system  of  production  and  thus  replaced  the  former  pri- 
vate owner  by  a  sort  of  impersonal  mechanism^1) 

(x)  One  should  read  the  proceedings  of  the  Verein  fur  Sozialpolitik 
entitled  "Das  Arbeitsverhaltnis  in  der  privaten  Riesenbetrieben"  and 
"Das  Verhaltnis  der  Kartelle  zum  Staat,"  in  the  Schriften  des  Vereins 
fur  Socialpolitik,  Volume  116,  Leipzig,  1906.  A  similar  train  of  thought 
is  to  be  found  in  the  works  of  Adolf  Wagner,  who,  for  example,  recently 
stated:  "If  one  makes  the  comparison,  one  should  not  overlook  the  fact 
that  in  all  large  private  and  corporate  industrial  undertakings,  a  sort  of 
bureaucratic  organization — not  at  all  dissimilar  to  that  to  be  found  in 
state-run  enterprises — has  sprung  into  existence,  strict  relations  to  those 
in  authority  and  a  state  of  rigorous  dependence.  *  *  *  You  are  located 
here  right  in  the  centre  of  the  great  Rhenish-Westphalian  industrial  field- 
The  principal  coal  producing  area  in  Germany  has,  thanks  to  the  pro- 
visions of  the  mining  law,  passed  into  the  hands  of  private  individuals, 
mining  and  stock  companies,  and  is  worked  in  order  to  produce  a  profit 
for  the  companies  interested,  that  is,  for  their  owners  and  stockholders, 
for  their  directors  and  managers  with  their  colossal  salaries  and  tontines 
and  for  the  payment  of  dividends.  I  admit  that  remarkable  results  have 
been  accomplished  under  this  system.  But  could  not  the  state,  as  a 
matter  of  fact,  accomplish  just  as  much  and  would  not  then  all  these 
profits  blow  into  the  pockets  of  the  general  public?"  Proceedings  of  the 
23d  Evangelical-Socialistic  Congress,  held  at  Essen,  May  28th-30th,  1912. 
Protokoll,  p.  47. 

30 


This  opinion,  which  is  becoming  all  the  time  more  and  more 
widespread  and  which  leads  to  important  political  consequences, 
I  deem  to  be  one  of  the  most  dangerous  fallacies  of  our  age,  both 
because  it  seems  to  coincide  with  the  truth  and  because  it  is  based 
on  analogies  which  are  especially  susceptible  of  acceptance  in  this 
era  of  social  legislation.  Inasmuch  as  I  am  dealing  with  the  un- 
desirable effects  of  German  social  legislation,  I  consider  it  neces- 
sary to  comfute  this  fallacy  in  all  its  aspects.  Therefore  I  pro- 
pose to  make  an  examination  of  that  branch  of  industry  in  which 
the  concentration  and  bureaucratic  perfecting  of  private  industry 
is  the  furthest  advanced  and  in  which,  on  the  other  hand,  state 
ownership  is  making  the  greatest  headway,  namely,  coal  mining. 

The  Prussian  government  is  today  the  greatest  coal  mine 
operator  in  the  whole  German  Empire.  The  state  has  a  numer- 
ous, trained  force  of  officials,  which  is  thoroughly  conversant  with 
all  the  ins  and  outs  of  mining.  The  mines  in  private  hands,  how- 
ever, under  the  auspices  of  the  great  banks,  have  joined  in  form- 
ing powerful  companies  and  are  so  closely  united  in  a  coal  syndi- 
cate that  a  finely  organized  administrative  system  encompasses 
the  entire  industry.  In  view  of  this  all-opposition-crushing  form 
of  organization,  we  may  ask  again  the  question,  what  can  a  single 
individual  accomplish  in  this  colossal  machine  ?(x) 


O)  The  parliamentary  investigation  which  was  carried  on  in  the 
years  1910  and  1911,  in  consequence  of  a  resolution  adopted  by  the 
Abgeprdnetenhaus,  has  furnished  excellent  material  for  answering  this 
question.  In  the  session  of  the  Abgeordnetenhaus  held  on  March  1st, 
1910,  it  was  resolved  to  appoint  a  subcommittee  of  the  budget  commission 
with  the  following  assigned  duties :  (a)  Of  examining  into  the  question 
of  how  the  government  operation  of  mines  could  be  made  to  produce 
better  results  without  endangering  economic  or  social-polity  require- 
ments, and  (b)  Of  submitting  a  writen  report  concerning  the  results  of 
their  investigations.  The  investigations  were  started  immediately  and  a 
session  took  place  on  April  21st,  1910,  in  which  privy  councillors  from  the 
ministries  of  Commerce  and  of  Finance  took  part  as  representatives  of 
the  government.  The  committee  requested  from  the  government  a  report 
regarding  technical  conditions  and  the  special  equipment  used  in  certain 
of  the  state  mines,  also  a  summary  of  the  operating  results  for  a  number 
of  years  past  of  the  mines  in  question,  included  in  which  were  costs  per 
workman  employed  and  per  ton  of  coal  produced,  the  average  coal  pro- 
duction per  miner,  timbering  costs  or,  where  such  a  case  applied,  the 
cost  of  iron  props,  the  methods  of  reckoning  value  of  property  on  hand 
and  receipts,  additions  and  depreciation,  the  amount  of  coal  produced  in 
cross-cutting  and  drifting  as  compared  to  the  amount  called  for  in  the 
course  of  the  year,  and  the  social  legislative  burdens  and  taxes.  The 
government  furnished  the  desired  material  to  the  investigating  committee 
and  added  thereto  a  memorandum  concerning  the  development  of  state 
operation  of  mines  in  Prussia  (printed  in  No.  307c  of  the  Drucksachen 
des  Hauses  der  Abgeordneten,  21  Legislaturperiode,  4  Session,  1911, 
pp.  1  to  20),  also  a  statement  of  the  mine  officials  in  answer  to  certain 
questions  of  the  subcommittee  (printed  as  above,  pp.  21  to  46),  and  fur- 
thermore a  set  of  illustrations  and  tables,  besides  a  memorial  regarding 
the  make-up  of  the  mining  budget. 

Based  on  this  material,  a  report  was  prepared  and  considered  in  a 
session  held  on  March  8th,  1911.  Besides  the  members  of  the  subcom- 

31 


At  the  head  of  every  coal  mine  we  find  a  mining  superin- 
tendent and  we  soon  ascertain  that  the  profitableness  and  the 
development  of  the  mine  depends  mainly  on  his  ability,  knowledge 
and  energy.  According  to  those  who  are  in  a  position  to  know, 
a  newly  appointed  superintendent  requires  from  three  to  four 
years  to  thoroughly  familiarize  himself  with  conditions  both  above 
and  below  ground.  (*)  Based  on  the  knowledge  of  conditions 
thus  acquired,  the  superintendent  gradually  develops  his  plan  of 
operations,  and  the  consistent  carrying  out  of  this  plan  becomes 
his  life's  work.  His  success  in  his  calling,  his  material  prosperity 
and  his  reputation  in  the  coal-mining  industry  depend  on  whether 
or  not  he  knows  enough  to  carry  out  his  plan  of  production  with 
consummate  skill.  This  question  is  also  of  paramount  importance 
for  the  shareholders  and  those  having  profit-sharing  certificates 
of  interest  in  the  mine.  The  privately  conducted  mines,  there- 
fore, seek  to  secure  for  such  positions  men  of  ability,  who  are 
still  at  an  active  and  adaptable  age,  and  to  retain  them  in  their 
positions  of  responsibility  for  as  long  a  time  as  possible.  The 
superintendents  of  the  privately  owned  mines  are  generally  ap- 
pointed to  their  positions  when  they  are  from  30  to  35  years  of 
age  and  remain  at  their  posts  for  30  years  or  more. 

A  general  inquiry  conducted  in  October,  1912,  gave  the  fol- 
lowing results: 

Out  of  60  mining  superintendents  of  private  companies,  there 
had  remained  in  their  positions 

1  for  1  year 

1  for  2  years 

2  for  3  years 
1  for  4  years 

1  for  5  years 

2  for  6  years 
4  for  7  years 

That  is,  only  12,  or  20  per  cent.,  of  the  superintendents  of 
these  privately  owned  mines  had  been  in  charge  of  the  operations 
entrusted  to  them  for  seven  years  or  less. 

On  the  other  hand,  there  had  remained  longer  in  their 
positions 

5  from     8-12  years 

5  from  13-15  years 

12  from  16-20  years 

16  from  21-30  years 

7  from  31-40  years 

3  from  41-51  years 

C1)     Bericht,  No.  307b,  p.  31. 

mittee,  representatives  of  the  government  also  took  part  at  this  session. 
On  May  4th,  1911,  the  report  was  considered  in  detail  by  the  budget  com- 
mittee of  the  Abgeordnetenhaus.  (Drucksache,  No.  307a  and  No.  307b). 

32 


The  age  at  which  the  60  acting  mining  superintendents  of  the 
private  companies  took  office  has  been  given  to  me  as  follows : 

4  at  the  age  of  28  years 

2  at  the  age  of  29  years 

9  at  the  age  of  30  years 

23  at  the  age  of  31-35  years 

Therefore,  38,  or  63  per  cent.,  were  less  than  35  years  old. 

How  entirely  different  are  conditions  in  the  government  serv- 
ice. Of  the  82  government  superintendents,  there  had  remained 
in  their  positions  (M 

6  for  1  year 
11  for  2  years 

8  for  3  years 

7  for  4  years 
7  for  5  years 

9  for  6  years 
9  for  7  years 

Thus  about  70  per  cent,  of  all  the  superintendents  of  the 
royal  mines  in  the  Saarbrucken  district  had  managed  the  mines 
entrusted  to  them  for  seven  years  or  less.  Regarding  this  fact, 
the  investigating  committee  makes  the  following  remark : 

"It  must  appear  as  a  very  serious  matter  whenever  a  manager 
who  has  only  just  begun  to  carry  out  his  plans  in  a  practical  way 
is  promptly  replaced  by  a  successor.  The  latter  is  not  sufficiently 
well  informed  concerning  his  predecessor's  intentions  and  tries 
to  make  the  preparatory  work  heretofore  done  fit  in  with  his  own 
fixed  plans.  In  striving  to  attain  this  object,  he  has  also  to  solve 
the  still  more  difficult  problem  of  winning  over  to  his  plans  the 
officials  who  have  been  trained  to  follow  the  ideas  of  his  prede- 
cessors. A  change  every  four  or  five  years  in  the  position  of 
general  manager  must  naturally  result  in  the  subordinate  officials 
having  control  of  matters  to  a  considerable  extent.  In  the  Prov- 
ince of  Saarbrucken  especially  several  unpleasant  experiences  of 
this  kind  have  occurred.  As  matters  stand  today,  the  subordi- 
nate officials  are,  so  to  say,  the  axis  on  which  everything  turns  in 
this  interplay  of  forces." 

"These  drawbacks  are  aggravated  by  the  fact  that  the  govern- 
ment superintendents  are  much  more  overburdened  than  the  man- 
agers of  the  privately  owned  mines  with  formal  documents, 
writings  and  reports  of  all  kinds.  The  state  officials  expressly 
concede  this  in  the  following  words:  It  should  be  remembered 
'that  the  extent  of  administrative  formalities  is  much  larger  in 
the  case  of  a  government  owned  than  of  a  privately  run  mine. 
The  numerous  returns  and  written  reports,  which  are  unavoid- 
ably connected  with  a  governmental  organization,  as  well  as  the 


(!)     Bericht,  No.  307B.  p.  31.    The  government  superintendents  assume 
their  positions  at  an  age  of  from  38  to  42  years. 

33 


detailed  labors  caused  by  the  government  system  of  budget 
making,  of  audit  and  of  requiring  vouchers,  in  which  matters  the 
mine  superintendent  above  all  others  must  take  a  hand  and  the 
other  high  officials  as  well,  all  these  in  privately  owned  under- 
takings are  either  entirely  done  away  with  or  dispatched  in  a 
much  simpler  and  less  exacting  way.'  In  a  business  run  by  pri- 
vate individuals — inasmuch  as  the  superintendent  is  perpetually 
being  checked  up  by  persons  actively  interested,  either  by  the 
owner,  or  a  committee  of  directors,  or  a  board  of  managers — the 
possibility  always  exists  of  simplifying  a  too  detailed  system  of 
control  without  running  the  risk  of  not  being  sufficiently  well 
posted.  The  interested  parties  also  see  to  it  that  the  labors  of  the 
superintendent  are  lightened  through  the  employment  of  in- 
spectors and  technically  trained  assistants,  while  the  high  mining 
officials  in  the  government  service  are  often  overburdened  with 
petty  details."  (*) 

Of  still  greater  importance  is  the  following  circumstance: 
The  parliamentary  commission  was  especially  struck  with  the 
fact  that  in  contrast  to  the  managers  of  the  privately  owned 
mines,  the  state  mining  superintendents  were  greatly  restricted  in 
their  freedom  of  action.  The  government  has  expressly  conceded 
this  lack  of  freedom  of  action.  In  its  memorandum,  the  follow- 
ing is  stated  :(2) 

"The  limited  freedom  of  action  accorded  the  higher  officials, 
which  has  been  so  much  regretted,  is  more  or  less  closely  con- 
nected with  the  fact  that  the  administrative  officials  of  the  mines 
have  to  reckon  with  a  budget,  the  drawing  up  of  which  has  to 
be  begun  before  the  course  of  the  ensuing  industrial  year  can  be 
foreseen.  All  estimates  of  receipts  and  expenditures  are  thereby 
made  more  difficult  and  uncertain.  The  selection  of  the  most 
favorable  moment  for  making  improvements  is  also  made 
difficult,  as  well  as  the  observance  of  the  principle,  so  important 
both  from  a  fiscal  and  from  an  economic  standpoint,  namely,  to 
take  advantage  of  a  period  of  bad  times  when  prices  are  low  for 
the  carrying  out  of  improvements  and  thus  to  furnish  orders  to 
depressed  private  industry.  Furthermore,  it  is  a  drawback  that 
the  budget  of  the  department  of  mines  has  to  be  accommodated 
to  general  financial  conditions  in  such  a  way  as  may  seem  best 
in  order  to  have  the  budget  balance  in  every  single  budget  year. 
But  this  may  influence  the  enterprise  unfavorably  and  also  the 


C1)  Denkschrift,  No.  307c,  p.  26.  The  government  memorandum 
concedes  this  in  the  following  words :  "The  fact  has  not  been  taken  into 
account  that  the  private  mining  industry  employs  a  large  number  of  uni- 
versity educated  engineers,  especially  of  machinery  engineers,  whose 
employment  in  the  state  mines  means  more  work  for  the  higher  mining 
officials.  Nor  has  it  been  taken  into  account  that  these  last  are  obliged 
to  perform  certain  duties  which,  in  the  private  mining  industry,  are  at- 
tended to  by  inspectors  not  university  bred,  such  as  have  been  promoted 
on  account  of  their  especial  efficiency  from  the  ranks  of  the  foremen." 

(2)     Denkschrift,  No.  307c,  p.  28. 

34 


government  receipts — if  one  looks  beyond  the  results  of  a  single 
budget  year.  The  protracted  budget  proceedings  are  found  espe- 
cially trying  in  those  cases  in  which  the  speedy  installation  of  a 
new  operating  appliance  is  known  to  be  advantageous  and  profit- 
able. A  fund  is  indeed  available  at  the  central  office  for  unfore- 
seen, urgent  betterments.  But  it  is  so  small  in  amount  that  it  is 
employed  more  in  the  prevention  of  losses  than  in  the  making  of 
profitable  improvements." 

Yet  the  trouble  (1)  is  to  be  found  not  only  in  the  system  of 
budget  making,  but  also  in  "the  lack  of  freedom  of  action  as 
regards  the  choice,  pay,  appointment,  advancement  and  dismissal 
of  employees.  The  granting  of  increases  in  salaries  and  of  pre- 
miums also  helps  to  make  it  harder  for  the  mining  superintendent 
to  conduct  matters  with  success.  The  superintendent  lacks  the 
power  of  exercising  an  effective  control  over  the  officials  and  of 
thereby  increasing  his  authority  and  the  success  of  his  manage- 
ment. For  example,  what  is  a  superintendent  to  do  if  a  mining 
shift  fails  to  work  to  full  capacity  and  he  is  not  in  a  position  to 
dismiss  the  men,  because  he  is  hampered  in  employing  other 
workmen  and  must  also  keep  wages  up  to  a  certain  prescribed 
level?" 

The  difference  between  government  and  private  management 
becomes  more  plain  if  one  considers  that  "officials  in  the  middle 
grades"  cannot  be  removed,  even  though  they  perform  very  in- 
efficient services.  In  its  memorandum  the  government  has  in- 
dulged quite  unreservedly  in  the  following  reflections,  to  which, 
on  account  of  their  general  importance,  I  would  like  to  call  at- 
tention :(2) 

"In  the  opinion  of  the  bureau  of  mines,  the  raising  of  those 
employed  in  the  middle  grades  of  the  service  to  the  position  of 
government  officials  has  not  met  with  the  desired  success.  In 
this  respect,  private  industry  works  under  more  favorable  condi- 
tions than  state  mining.  In  the  former  these  employees  are  sub- 
ject to  dismissal  and  furthermore  their  interest  in  effecting  econ- 
omies and  savings  is  always  being  kept  alive  by  a  widespread  sys- 
tem of  premiums.  It  is  true  that  the  large  majority  of  the  gov- 
ernment mining  officials  show  a  very  active  interest  in  their  work 
and,  thanks  to  the  zeal  displayed  by  the  better  equipped  among 
them,  play  a  very  prominent  part  in  the  development  of  the  mines. 
But  among  the  great  number  of  these  officials,  there  are  never- 
theless others,  who  report  promptly  for  work,  it  is  true,  and 
against  whom  one  cannot  prove  any  intentional  neglect  of  duty. 
These  do  not,  however,  take  the  necessary  interest  in  their  work, 
and  are  not  as  active  as  should  be  expected.  It  is  impossible  to 
better  matters  by  a  system  of  disciplinary  punishments.  An  offi- 
cial, who  fails  to  fulfil  his  duties  on  account  of  lack  of  ability  or 


0)     Bericht,  No.  307B,  p.  74. 
(2)     Denkschrift,  No.  307c,  p.  29. 


35 


intelligence,  cannot  be  punished.  Furthermore,  the  lack  of  in- 
terest displayed  is  seldom  so  great  that  neglect  of  official  duties  or 
a  punishable  offence  can  be  clearly  proven.  The  example  set  by 
one  or  several  of  such  officials  also  exerts  a  bad  influence  on  the 
others.  If  these  last  see  that  even  if  little  work  is  performed, 
the  salary  is  raised  just  the  same  as  before,  and  that  even  though 
more  industry  be  displayed  and  better  results  accomplished  they 
receive  no  higher  pay  than  a  negligent  official,  it  is  quite  natural 
for  their  zeal  to  slacken.  In  this  way,  the  average  amount  of 
work  performed  is  cut  down.  This  drawback  is  of  all  the  more 
importance  because  the  mining  officials  exert  a  very  great  influ- 
ence in  the  matter  of  net  costs." 

It  is  easy  to  understand  why  the  parliamentary  commission 
devoted  especial  attention  to  this  question,  and  its  report  contains 
this  momentous  sentence :  "The  bestowal  of  official  positions  has 
resulted  in  a  lack  of  interest,  a  slackening  in  the  zeal  for  work 
and  a  lessening  of  the  average  amount  of  work  performed." 

In  view  of  such  official  confessions  and  of  the  results  estab- 
lished by  the  parliamentary  investigation,  it  was  natural  to  hold 
the  state  administration  responsible  for  the  conditions  revealed 
and  to  ask  the  government  to  do  away  with  these  evils.  The 
Abgeordnetenhaus,  therefore,  demanded  that  the  budget  of  the 
state  mining  department  should  be  prepared  after  the  manner 
of  the  balance  sheets  of  private  industrial  undertakings  and  that 
— just  as  in  private  employments — the  superintendents  and  the 
underground  foremen  should  obtain  an  interest  in  the  profits  of 
the  mine  by  a  system  of  tantiemes  and  of  premiums.  The  gov- 
ernment agreed  to  this  readily,  changed  the  form  of  the  budget 
and  demanded  a  grant  of  124,000  marks  for  the  share  in  the 
profits  to  go  to  the  higher  officials  and  278,000  marks  premiums 
for  the  middle  grade  officials  of  the  government  mines. 

The  mere  announcement  of  this  measure  had  an  interesting 
effect.  Immediately,  through  the  parliamentary  representatives, 
several  classes  of  officials  were  heard  from  who  had  not  been 
considered  among  those  who  were  to  share  in  the  proposed  tan- 
tiemes and  premiums.  Already  in  the  sessions  of  the  budget 
committee,  the  government  was  urged  "to  allow  the  mining  in- 
spectors of  the  state"  mines  to  share  in  the  profits,  because  these 
were  an  important  factor  in  making  the  mines  profitable.  Fur- 
thermore, in  the  session  of  the  whole  house  it  was  hinted  that  the 
"machinery  drill  men"  would  have  to  share  in  the  premiums  and 
even  the  "royal  mining  surveyors  of  the  mining  district  of  Saar- 
briicken"  sent  a  petition  to  the  members  of  the  Abgeordnetenhaus 
in  which  they  asked  for  a  share  in  the  profits  or  premiums.  But 
the  following  occurrence  appears  to  me  to  be  most  characteristic 
of  all.  As  Abgeordneter  Brust  mentioned,  the  underground  fore- 
men were  formerly  opposed  to  premiums  from  principle.  But 
as  the  government  inserted  in  its  budget  a  premium  fund,  they 
"became  reconciled  to  the  matter"  and  only  demanded  "consid- 

36 


erably  hgher  premiums." 0)  Thus  supported  by  the  large  parties, 
the  officials  make  their  demands  known  and  the  Prussian  Min- 
ister of  Commerce  declared  with  justifiable  irony  in  the  Abgeord- 
netenhaus :  "Last  year  it  was  stated  on  all  sides  that  the  mining 
department  exchequer  should  be  run  more  according  to  business 
principles  and  today  all  these  fine  plans  have  ended  in  smoke." 
The  Minister  of  Commerce  let  it  be  clearly  seen  that  in  the  case  of 
the  Abgeordneten  fear  of  the  electorate  was  one  of  the  impelling 
motives. (2)  The  members  of  the  Abgeordnetenhaus  thoroughly 
understand  that  the  officials  and  the  workmen  in  the  government 
service  wait  until  the  time  of  the  elections  for  the  Reichstag  be- 
fore they  settle  accounts. 

Here  we  encounter  the  determining  factor.  One  may  talk  as 
much  as  one  likes  about  the  reform  of  government  business 
methods  and  about  the  principles  of  business  management,  the 
fact  has  to  be  recognized  in  the  end  that  defects  are  here  in- 
volved which,  as  far  as  government  administration  is  concerned, 
can  never  be  got  rid  of.  Just  as  parliament  and  the  government 
appointees  advise  and  admonish  regarding  the  distribution  of 
official  premiums,  these  same  two  forces  make  their  influence  felt 
in  all  branches  of  government  administration.  For  example, 
when  the  government  officials  voluntarily  conceded  that  it  had 
been  a  mistake  to  bestow  on  "employees  in  the  middle  grades"  of 
the  government  mining  service  the  position  of  officials  and  it  was 
then  considered  whether  former  conditions  might  not  be  restored, 
the  authorities  urged  in  opposition  thereto  that  "they  did  not  wish 
to  be  confronted  with  the  hearty  ill-will  of  the  mining  officials, 
which  would  be  certain  to  occur."  To  this  they  added  this  state- 
ment, which  is  interesting  on  account  of  the  principle  underlying 
it:  "Especially  in  view  of  the  continuous  extension  of  the  num- 
ber of  government  officials  in  the  railway  service,  one  is  obliged 


C1)  "The  middle  grade  of  officials  of  the  government  mines  have  be- 
come reconciled  to  this  measure;  they  only  ask  for  considerably  higher 
premiums  than  is  proposed  in  the  budget.  If  they  are  to  receive  at  the 
outside  only  240  marks  more  yearly  and  the  higher  mining  officials  up  to 
2,580  marks  more  on  the  average,  then  as  compared  with  the  last  the 
former  sum  appears  insultingly  small  and  indicates  evidently  a  disregard 
of  the  importance  of  the  work  performed  by  the  underground  foremen." 
Abgeordneter  Brust  in  the  Abgeordnetenhaus  on  March  4th,  1912. 

(2)  The  Minister  of  Commerce  said:  "After  all  the  previous  speak- 
ers have  sought  to  commend  themselves  to  the  voters  of  their  election 
districts  by  warmly  seconding  the  requests  for  an  increase  in  the  wages 
of  miners,  it  is  difficult  for  me  to  enter  into  competition  with  them.  The 
matter  does  not  end  with  a  declaration  such  as  I  may  make  here,  but 
either  I  or  the  administration  represented  by  me  is  every  year  urged  to 
carry  out  this  declaration  to  its  logical  conclusion.  In  this  sort  of  com- 
petition I  am  at  a  disadvantage.  Therefore,  I  am  obliged  to  confine  my^ 
self  to  purely  sober  realities,  but  desire  to  interpolate  here  how  greatly 
interested  I  was  to  hear  that  the  Secretary  of  the  Saarbrucken  Chamber 
of  Commerce  expressed  himself  also  so  warmly  for  an  increase  in  the 
wages  of  the  miners,  nota  bene  at  the  expense  of  the  government  ex- 
chequer." 

37 


to  exclude  all  thought  of  undoing  this  step  as  regards  the  gov- 
ernment mining  officials." (*) 

This  statement  is  interesting  for  the  principle  underlying  it, 
because  it  shows  clearly  how  as  the  number  of  officials  grows, 
the  various  branches  of  the  government  service  are  affected  by 
considerations  which  make  a  proper  kind  of  management  appre- 
ciably more  difficult.  If  it  be  stated  at  another  time  that  a  change 
"would  encounter  too  many  difficulties  on  account  of  the  resultant 
comparison  with  other  classes  of  officials"  and  if  a  less  advan- 
tageous measure  is  recommended  by  the  authorities  because  it 
could  be  carried  out  "without  causing  an  upsetting  of  the  scale 
of  salaries," (2)  these  are  but  external  expressions  of  the  con- 
straint for  which  no  person  or  set  of  officials  can  be  held  respon- 
sible. The  more  the  scope  of  government  activities  is  extended 
and  the  number  of  officials  increased  and  the  more  the  members 
of  parliament  feel  obliged  for  election  purposes  to  pay  heed  to  the 
demands  of  the  officials  and  workmen  engaged  in  government 
employments,  the  more  oppressive  will  this  sense  of  constraint 
appear.  Even  though  the  state  should  imitate  in  its  industrial 
budgets  and  manner  of  reckoning  tantiemes  the  methods  of  a  pri- 
vate employer,  it  is  nevertheless  unable  to  conceal  how  few  it 
possesses  of  those  qualities  which  enable  the  private  employer  to 
seek  out  new  openings  and  to  forge  ahead  along  new  lines. 

C1)     "Aesserung  der  preussischen  Bergverwaltung  Drucksachen"  des 
Abgeordnetenhauses,  No.  307  C,  p.  29. 

(2)     "Ausserung  der  preussischen  Bergverwaltung/'  p.   27. 

• 


PART  TWO. 
THE  STRUGGLE  FOR  INSURANCE  PENSIONS. 

INTRODUCTION. 

"It  is  the  weighty  task  of  the  law-making  branch,  in  the  in- 
terest of  the  working  population  as  well  as  in  that  of  the  whole 
people,  to  make  use  of  every  available  means  of  preventing  as 
far  as  possible  covetous  ideas  from  exerting  an  influence  on  the 
granting  of  pensions.  The  neglect  of  this  duty  would  necessa- 
rily result  in  a  diminution  of  the  love  for  work  and  of  the  sense 
of  moral  responsibility  among  such  of  the  insured  as  no  longer 
possess  their  full  working  powers  and  at  the  same  time  cause  an 
injury  to  the  people's  working  strength."  Thus  did  the  Imperial 
Insurance  Office  express  itself  in  1906. (*)  Today,  however, 
many  observers  doubt  whether  it  will  be  at  all  possible  to  avoid 
this  injury  to  the  people's  working  strength. 

In  order  to  do  away  with  all  misunderstanding  from  the  start, 
I  wish  to  emphasize  the  fact  that  in  employing  this  form  of  char- 
acterization, nothing  is  said  which  in  any  way  reflects  discredit 
on  the  working  classes.  Long  before  the  development  of  German 
workingmen's  insurance,  physicians  had  realized  that  the  rail- 
ways (employers'  liability)  and  the  insurance  companies  had  to 
carry  on  a  constant  warfare  against  unjustifiable  demands.  It 
was  also  known  in  this  connection  that  members  of  the  "upper 
classes"  also  were  distinguished  for  exaggerating  their  injuries 
until  the  attainment  of  an  indemnity  cured  them  with  extraor- 
dinary rapidity.  (2) 

The  desire  to  derive  a  profit  from  an  accident  is  so  human  that 
a  prominent  physician  has  designated  such  "enrichment  ideas"  as 
"entirely  normal  occurrences  even  with  the  best  of  our 

people."(3) 

The  real  danger  lies  herein,  however,  that  a  wide  field  was 
thrown  open  to  this  human  weakness  when  the  system  of  pension 
insurance  was  compulsorily  introduced  and  when — partly  out  of 
ignorance  and  partly  from  a  wish  to  win  the  masses — necessary 
safeguards  were  neglected  and  a  cast  was  given  to  government 
pension  insurance  which  is  just  provocative  of  abuses. 

In  a  country  where  many  millions  of  people  are  insured  under 
a  uniform  system,  many  millions  of  eyes  are  naturally  being  di- 

(1)  Amtliche  Nachrichten  des  R.  V.  A.,  Vol.  XXMI. 

(2)  Rigler:    Ueber  die  Folgung  der  Verletzungen  auf  Eisenbahnen, 
insbesondere  des   Rtickenmarks  Dargestellt  mit  Hinblick  auf  das  Haft- 
pflichtgesetz.     Berlin,  1879,  p.  7. 

(3)  Cramer:    At  the  meeting  in  1907  of  the  southwest  German  neu- 
rologists and  alienists. 

39 


rected  continuously  to  the  mechanism  devised  for  the  spending 
of  the  insurance  money.  Every  defect  therein  is  spied  out  and 
made  full  use  of,  everything  that  offers  a  possibility  of  success 
is  tried  and  becomes  quickly  known  among  the  great  mass  of  the 
people.  And  this  "posting"  of  the  masses  is  by  no  means  de- 
pendent upon  chance,  but  is  thoroughly  well  organized.  Today 
the  workingmen's  unions — including  both  the  Social  Democratic 
and  the  other  unions — have  their  "permanent  representatives  at 
the  Imperial  Insurance  Office — secretaries,  who  not  only  assist 
the  workingmen  in  their  lawsuits,  but  who  also  supply  the  press 
with  copy  and  keep  the  members  of  the  Reichstag  posted." 

On  March  21st,  1912,  a  member  stated  in  the  Reichstag :  "I 
have  in  my  portfolio  quite  a  number  of  decisions  obtained  from 
the  Imperial  Insurance  Office  by  the  representative  of  the  Chris- 
tian Miners'  Union."  The  material  thus  furnished  is  publicly 
made  use  of  and  individual  cases  are  discussed  for  weeks  at  a 
time  without  any  one  being  in  a  position  to  investigate  the  cor- 
rectness of  the  statements  which  have  been  given  out.  Under 
these  conditions,  there  is  only  one  way  of  obtaining  a  true  insight 
into  the  meaning  of  these  occurrences  which  party  politics  and 
party  intrigues  help  to  make  obscure:  One  must  resort  as  far 
as  possible  to  the  medical  publications. 


CHAPTER  I. 

MEDICAL  LITERATURE. 

I  thoroughly  realize  that  herein  I  touch  upon  a  subject  which 
only  a  physician  can  fully  understand  and  pass  judgment  upon. 
But  political  economists  can  no  longer  ignore  or  hastily  pass  over 
the  enormous  mass  of  material  that  has  been  assembled  by  the 
"other  faculty."  Physicians  nowadays  play  such  an  important 
role  in  German  social  legislation  that  some  economic  problems 
cannot  be  discussed  at  all  without  considering  the  medical  publi- 
cations on  the  subject. 

The  doctors  were  the  ones  who  first  called  attention  to  the 
seamy  side  of  German  workingmen's  insurance  legislation.  To 
be  sure,  where  any  attention  at  all  was  paid  to  such  skeptics,  they 
were  sharply  called  to  account.  It  was  then  still  the  period  when 
every  one  who  ventured  to  inquire  into  the  meaning  of  the  sacred 
syllables,  "workingmen's  insurance,"  endangered  his  reputation. 

The  medical  critics  made  only  slow  progress.  At  the  Inter- 
national Congress  held  in  Berlin  in  1890,  general  uncertainty  con- 
cerning this  question  was  still  prevalent.  For  this  reason  the 
Congress  for  Internal  Diseases  made  it  one  of  the  subjects  to  be 
discussed  at  its  meeting  in  1893.  StrumpeH's  report  (*)  especially 
excited  the  minds  of  those  present  without,  however,  shedding 

C1)     Berliner  klin.  Wochenschr.,  1893,  No.  21,  p.  505  (short  report). 

40 


much  light.  Two  years  later  Striimpell  published  an  article  (1) 
in  which  he  stoutly  maintained  that  "covetous  ideas"  played  an 
important  part  in  workingmen's  insurance.  The  desire  to  attain 
a  pension  as  a  sequence  to  an  accident  often  completely  domi- 
neered the  insured  and  caused  the  appearance  of  a  nervous 
disease. 

One  would  almost  like  to  say  that  the  most  characteristic  and 
effective  feature  of  this  publication  was  to  be  found  in  the  fact 
that,  six  years  previously,  in  an  article  on  "traumatic  hyste- 
ria" (2),  Striimpell  had  taken  an  entirely  opposite  position.  This 
literary  prelude(3),  which  was  bitterly  fought  over  from  1888 


C1)     "Ueber  die  Untersuchung,  Beurteilung  und  Behandlung  von  Un- 
fallkranken  Praktische  Bemerkungen.     Munich,  1895. 

(2)  "Uber  Traumatische  Hysteric."    Munch,  med.  Wochenschr.,  1889, 
p.  189,  et  seq. 

(3)  Between    1889    and    1896    appeared    in    particular    the    following 
publications : 

1889 

Oppenheim:     Die  Traumatische  Neurose. 

Striimpell:    Ueber  Traumatische  Hysteric.    Munch,  med.  Wochenschr., 
1889,  p.  189  et  seq. 

Seeligmuller:    Zur   Frage   der   Simulation   usw.    Zentralbl.   f.   Neurol. 
1889  No.  20. 

Lowenfeld :    Kritisches  und  Kasuistisches  zur  Lehre  von  den  sogenann- 
ten  traumatischen  Neurosen  Munchner  med.  Wochenschr.,  1889,  No.  38. 

1890 

Verhandlungen  des  X.  International  Medizinischen  Kongresses. 
J.  Hofmann :     Erfahrungen  iiber  traumatische  Neurose.     Berliner  klin. 
Wochenschr.,  1890  No.  29  p.  655  et  seq. 

Seeligmuller :    Die  Errichtung  von  Unfallkrankenhansern.  Leipzig  1890. 

1891 

F.  Schultze :    Ueber  Neurosen  und  Neuropsychen  nach  Thauma.  Samml. 
klin.     Vortrage  N.  F.  No.  14  1891. 

Albin  Hoffmann:    Die  traumatische  Neurose  und  das  UnfaLversicher- 
ungsgesetz.    Samml.  klin.  Vortrage  N.  F.  No.  17,  1891. 

Honig:    Simulation  und  Uebertreibung  der  Unfallverletzen. 
Oppenheim:     Weitere  Mittheilungen  in  bezug  auf  die  traumatischen 
Neurosen  mit  besonderer  Beriicksichtigung  der  Simulationsfrage. 

1892 
Oppenheim :    Die  traumatische  Neurose.    2nd  Edition.    Berlin,  1892. 

1893 

XII    Kongress    fur   innere    Medizin,    insbesondere    die    Referate   von 
Strumpell  und  Wernicke. 

1894 

Lauenstein:    Beitrage  zur  Frage  der  Erwerbsfahigkeit  von  Personen. 
behaftet  mit  korperlichen  Schaden  und  Verletzungsfolgen. 

Jahrb.  der  Hamburger  Staatskrankenanstalten.    Hamburg,  1893-94  IV, 
p.  573. 

1895 

Striimpell :    Ueber  die  Untersuchung,  Beurteilung  und  Behandlung  von 
Unfallkranken  Miinchener  med.  Wochenschr.,  1895,  No.  49-50. 

1896 

Oppenheim:     Der  Fall   N.  ein  weiterer  Beitrag  zur   Lehre  von  den 
traumatischen  Neurosen. 

Bernstein:     Ueber  eine  besondere  Form  der  Neurose  bei  Unfallver- 
letzten  Arzl.     Sachverst-Ztg.  1896  S.  1. 

41 


to  1896,  and  which,  in  part,  took  the  form  of  bitter  personal  con- 
troversies, clearly  indicates  what  difficult  problems  the  physicians 
were  called  upon  to  solve  as  a  consequence  of  the  new  working- 
men's  insurance  legislation,  and  with  what  uncertainty  the  fore- 
most physicians  approached  the  problem. 

As  Oppenheim  wrote  in  the  spring  of  1896 :  "The  present 
condition  of  affairs  is  untenable,  inasmuch  as,  according  to  the 
present  status  of  medical  science,  two  medical  reports,  arriving 
at  directly  opposite  conclusions,  would  both  appear  justifiable/' 

That  suggestion  of  the  desirability  of  collecting  new  material 
yielded  good  fruits,  and  caused  the  appearance  of  a  mass  of  pub- 
lications in  the  following  years. 

The  publication,  in  the  fall  of  1896,  of  Dr.  Alfred  Sanger's 
valuable  experiences  made  a  deep  impression.  On  Eisenlohr's 
hint,  he  had  devoted  himself,  from  1888  on,  to  the  study  of 
nervous  diseases  caused  by  accidents,  and,  from  1891  on,  had 
made  his  observations  in  the  general  hospital  at  Hamburg  St. 
Georg.  For  purposes  of  comparison  he  was  able  also  to  make 
use  of  the  results  of  important  investigations  carried  on  by  an- 
other Hamburg  physician,  Dr.  Lauenstein,  and  as  a  result  wrote 
an  epoch-making  work  concerning  the  new  and  difficult  problem. 

Generally  speaking,  the  joint  work  of  psychiatrists  and  sur- 
geons was  unusually  rich  in  results.  In  surgery,  investigations 
required  in  accident  cases  as  to  the  time  of  healing  led  to  a  re- 
vision of  the  opinions  previously  advanced. 

After  the  publishing  of  Sanger's  work,  there  appeared  to  be 
quite  a  lull  in  the  medical  publications^1)  In  reality,  however, 


0)     No  noteworthy  1897  publication. 

1898 

Bruns:     Unfallneurosen.     Enzyklopadische  Jahrbiicher.  VIII  1398. 
Thiem:    Handbuch  der  Unfallkrankungen.     Stuttgart  1898. 

1899 

Sachs  u.  Freund:  Die  Erkrankungen  des  Nervensystems  nach  Un- 
fallen.  Berlin,  1899. 

1900 

Seiffer :  Schadliche  Suggestion  bei  Unfallnervenkranken.  Berliner  klin. 
Wochenschr.  1900  No.  37. 

Edinger  u.  Auerbach :  Unfallnervenkrankheiten.  Eulensburgs. 
Reaienzyklv  Vol.  XXV  1900. 

Levy:  Zur  Lehre  von  den  traumatischen  Neurosen.  Berliner  Klinik. 
Vol.  XVII,  1900  p.  205. 

Bogatsch:  Ueber  die  Ausgleichung  schwerer  Unfallfolgen  usw.  Wis- 
senschaftl.  Mitteil.  d.  Bresl.  Inst.  f.  Unfallverletzte  Breslau  1896. 

Leppmann :  Der  Kampf.  um  die  traumatische  Neurose  Arzt  Sach- 
verst-Ztg.  1896  No.  9. 

Fiirstner:  Einige  Erkrankungen  des  Nervensystems  nach  Unfaellen. 
Neurol.  Zentralblatt  1896  No.  20. 

Sanger:  Die  Beurteilung  der  Nervenkrankungen  nach  Unfall.  Stutt- 
gart 1896. 

Dittmer:  Ueber  Schulterverletzungen  mit  Bezug  auf  das  Unfallsver- 
sicherungsgesetz.  Archiv  fur  Unfallheilkunde,  Gewerbehygiene  und 
Gewerbekrankheiten,  p.  177  et  seq. 

42 


the  temporary  decrease  in  the  number  of  publications  denoted 
merely  a  change  in  the  trend  of  thought. 

Up  to  this  time,  the  physicians  had  for  the  most  part  con- 
centrated their  research  work  on  the  symptoms  of  the  disease. 
Now,  however,  they  began  to  go  back  to  its  causes,  and  soon 
the  social-polity  institutions  became  the  target  of  medical 
criticism. 

As  marking  the  beginning  of  this  new  point  of  view,  from  the 
physician's  standpoint,  is  to  be  noted  an  article  by  Auerbach  which 
appeared  in  1901  in  the  "Deutsche  medizinische  Wochenschrift," 
and  which  bore  the  significant  title  of  "The  Reform  of  Accident 
Insurance  Legislation." 

In  the  following  year  the  number  of  publications  increased. 
Almost  everyone  contended  that  a  reform  of  the  laws  was  neces- 
sary in  the  interests  of  the  general  public,  and  in  1905  the  cele- 
brated scholar  Quincke  of  Kiel  gave  vigorous  expression  to  this 
feeling.  0) 

The  influence  of  his  words  was  very  great;  and  consequently 
the  peripatetic  Congress  of  the  South-West  German  Neurologists 
and  Alienists  decided  to  include  in  their  order  of  business  a  dis- 
cussion of  "the  clinical  consequences  of  accident  insurance  legisla- 
tion." The  selection  of  this  subject  of  itself  attracted  attention, 
inasmuch  as  the  title  seemed  to  assume  as  a  matter  of  course  that 
accident  insurance  legislation  had  a  direct  influence  on  the  form 
of  diseases.  Not  only  did  Hoche,  the  chairman  of  the  meeting, 


(l)     Between  1901  and  1905  the  most  important  publications  were: 

1901 

Auerbach:  Zur  Reform  der  Unfallversicherungsgesetzgebung. 
Deutsche  med.  Wochenschr.  1901  No.  3  p.  42  et  seq. 

Sanger:  Ueber  die  nervosen  Folgezustande  usw.  Monats  schr.  f. 
Psychiatr.  u.  Neurol.  Vol.  X  No.  3. 

Stern:     Traumatische  Neurose  und  Simulation.     Brannschweig  1901. 

1902 

Auerbach:    Behandlung  der  funktionellen  Neurosen.    Berliner  Klinik. 

Bruns:  Die  traumatischen  Neurosen,  Nothnagels  spez.  Path.  u.  Ther. 
Vol.  XII,  1st  Part,  4th  Div. 

Eschle:     Das  Arbeitssanatorium  Miinchen. 

Frey:  Ueber  Traumatische  Neurosen.  Vierteljahrschr.  f.  gericht.  Med. 
3rd  series.  Vol.  XXIII  Suppl.  1902 

Knotz:  Zur  Frage  der  traumatischen  Neurose.  Aerztl.  Sachverst.-Ztg. 
1902  No.  8. 

1903 

Strauss:  Zur  Arbeitserziehung  Unfallverletzter.  Med.  Reform  1903 
No.  2. 

1904 

Biss :  Beitrage  aus  der  Proxis  zur  Frage  der  traumatischen  Neurosen. 
Aertzl.  Sachverst.  Ztg.  1904  No.  13. 

Pietrzikowski :     Die  Begutachtung  der  Unfallverletzten. 

1905 

Schuster :    Die  tramatischen  Neurosen.  Deutsche  Klinik.  Vol.  VI  div.  1. 

Windscheid :    Der  Arzt  als  Begutachter  auf  dem  Gebiete  der  Unfall-u. 

Inval:    Vers.  Jena  1905. 

Quincke:    Ueber  den  Einfluss  der  sozialen  Gesetze  auf  den  Charakter. 

43 


agree  with  Quincke,  but  the  discussion  and  the  numerous  inciden- 
tal papers  yielded  fresh  material  on  the  subject  of  "pension  hys- 
teria," "pension  neurasthenia"  and  "pension  hypochondria." 
Almost  all  of  them  confirmed  Quincke's  views  throughout.  (a)  If 

(i)  1906 

Hellpoch:  Unfallneurosen  und  Berufsfrende.  Neurol.  Zentralbl. 
1906  No.  13. 

Feilchenf eld :  Ueber  Rentenhysterie.  Aerztl.  Sachverst.  Ztg.  1906 
No.  16. 

Aerztliche  Sachverstandigenzeitung :  Die  Behandlung  schwerer  Unfall- 
folgen.  Mit  Aeusserungen  von  Bruns  (Hannover),  Eulenburg,  F. 
Schultze  (Bonn),  Moebius  (Leipzig),  Gaupp  (Munich),  Bernhardt, 
Schuster,  Weigandt  (Wiirzburg),  Fauser  (Stuttgart),  Boettiger  (Ham- 
burg), Seiffer,  Mincke,  Remak,  Unverricht,  Binswanger,  Windscheid, 
Steiner  (Cologne),  Edinger  (Frankfort-on-the-Main),  Hoffman  (Dussel- 
dorf),  Freund  (Breslau),  Sachs,  Mann,  Schuchardt  (Rostock),  Nonne 
(Hamburg),  Sanger,  Haenel  (Dresden),  Ziehen,  Doellcken. 

Doellcken:  Wann  sind  Unfallneurosen  Heilbar?  Neurol.  Zentralbl. 
1906  No.  23. 

Merzbacher:  Statistische  Bemerkungen  ueber  Unfallneurosen.  Zen- 
tralbl. f.  Nervenheilk.  u.  Psychiatr.  1906  p.  905. 

1907 

Wanderversammlung  der  sudwest  deutschen  Neurologen  und  Ir- 
renaerzte. 

Hoche:     Notwendige  Reformen  der  Unfallversicherungsgesetzgebung. 

Samml.  Zwangl.  Abhandlung  aus  d.  Gebiete  d.  Nerven  u.  Geisteskrankh. 
Vol.  VII.  No.  8  Halle  A.  S. 

Liniger:  Oberschenkelbruch  und  Unfallversicherung.  Archiv  f.  Or- 
thopadie  usw.  p.  99  et  seq. 

Lissauer:  Ueber  Rentenneurasthenie.  Aerztl.  Sachverst.  Ztg.  VIII. 
No.  18. 

Miiller:  Ueber  tramatische  Neurose.  Zeitschr.  f.  d.  ges.  Versicher- 
ungswissensch.  Book  2. 

Braun:  Praktische  Erfahrungen  ueber  die  traumatische  Neurose. 
Prager  med.  Wochenschrift.  April. 

1908 

Ewald :  Die  traumatischen  Neurosen  u.  die  Unfallgesetzgebung.  Med. 
Klinik  1908  12th  Supplement. 

Frohlich :  Zur  Begutachtung  der  nervosen  Unfallkranken  Zeitschr.  f. 
Bahn  u.  Bahnaerzte  1908  No.  12. 

Hoffa:  Welche  Nachteile  haben  sich  bei  der  Durchfuhrung  der  Un- 
fallversicherungsgesetze  ergeben?  Zeitschr.  f.  d.  ges.  Versicherungs- 
wissensch.  1908  Vol.  VIII  No.  1. 

Moiler:     Simulation  in  der  Unfallversicherung. 

Hellpoch  :  Rentenhysterie  :  Zeitschr.  f.  d.  ges.  Versicherungswissensch. 
Vol.  VTII  No.  2. 

Schonfeld :  Traumatische  Hypochrondric  oder  Rentenhypochondrie. 
Med.  Klinik  1909  No.  31. 

Worbs:  Zur  Frage  der  Arbeitsbehandlung  Unfallverletzter,  Aerztl. 
Sachverst.  Ztg.  1908  No.  6. 

1909 

Sachs:     Die  Unfallneurose. 

Wallenberg:     Traumatische  Neurose. 

Hoche:    Handb.  d.  gerichtl.  Psychiatric.    Berlin,  190& 

Mendel:     Neurasthenia  Querulatoria. 

1910 

Hoche:     Geisteskrankheit  und  Kultur. 

Ernst  Schultz :     Der  Kampf  um  die  Rente. 

Windscheid :  Der  Einfluss  der  Entschadigungsart  auf  den  Verlauf  der 
Unfallneurosen.  Ztschr.  fur  Versicherungsmedezin  No.  4. 

44 


uncertainty  reigned  in  former  years,  this  new  literature  established 
some  definite  doctrines.  Windscheid,  under  whose  direction  an 
institution  had  been  established  in  Leipzig  for  accident  patients 
suffering  from  nervous  diseases,  frequently  led  the  discussions — 
for  the  last  time  at  the  International  Accident  Congress,  which 
met  in  Rome,  in  May,  1909.  In  the  same  year,  Sachs  published 
an  article  on  "accident  neuroses,"  which  contains  perhaps  the 
most  interesting  material  of  all.  Schuster's  "Three  Lectures  on 
the  Subject  of  Accident  Neurology"  deals  with  particularly  im- 
portant phases  of  this  problem.  And  Hoche,  as  Rector,  made  the 
serious  consequences  of  workingmen's  insurance  the  main  sub- 
ject of  his  address,  entitled  "Civilization  and  Diseases  of  the 
Mind." 

By  emphasizing  this  subject,  Hoche  caused  the  appearance 
of  further  articles,  of  which  Laquer's  work,  "The  Curableness 
of  the  Nervous  Consequences  of  Accidents"  (1912),  probably 
occupies  the  first  place. 


CHAPTER  II. 

UNDESIRABLE  RESULTS   OF  PENSION    INSURANCE. 

When  it  was  first  asserted  that  workingmen's  insurance  en- 
dangered the  health  of  the  people,  this  paradoxical  statement  was 
greeted  with  laughter.  But  soon  corroborative  facts  were  at 
hand. 

In  Hamburg,  Lauenstein  established  the  fact(*)  that  foreign 
workmen  who  had  no  right  to  pensions  recovered  more  quickly 
under  the  same  conditions  than  native  workmen,  "who  are  thor- 


(l)     Beitrage  zur  Frage  der  Erwerbstatigkeit.     1893-94.  p.  573. 

Schuster :    Drei  Vortrage  aus  dem  Gebeit  der  Unfallneurologie. 

Biss:  Ueber  die  Hanfigkeit  funktioneller  Nervenkrankheiten  Aertzl. 
Sachverst.  Ztg.  No.  22. 

Schaller :    Einige  Zahlen  ueber  Unfallneurose. 

Kuhne:  Die  in  der  Versicherungsgesetzgebung  wirksamen  Einfliisse. 
Monatsschrift  f.  Unfallheilkunde  No.  10  and  11. 

Jacoby:  Zur  Verhutung  des  Entstehens  von  Unfallneurosen.  Viertel- 
jahrsschrift  f.  gericht.  Medizin  No.  4. 

Thiem:  Handbuch  der  Unfallkrankungen.  2nd  half,  1st  part,  2nd  ed. 

1911 

Grunewald :  Ueber  Ampassung  an  Funktionsausfalle  nach  Unfaller- 
krankungen.  Archiv  f.  Orthopadie  usw.  p.  7  et  seq. 

1912 

Laquer:    Die  Heilbarkeit  nervoser  Unfallsfolgen. 

Kuhne:  Unfallhysteriker,  ihre  Untersuchung  und  Beurteilung.  Ill 
Internationaler  Medizinischer  Unfallkongress  at  Dusseldorf  p.  141. 

Schultze,  Frierich  and  Stursberg:  Erfahrungen  iib.  Neurosen  nach 
Unfallen. 

45 


oughly  imbued  with  the  knowledge  of  their  pension  rights."  (1) 

As  Lauenstein  said:  "We  observe  that  certain  of  the  insured 
are  no  longer  as  much  interested  as  formerly  in  recovering  as 
quickly  as  possible,  and  that,  after  a  wound  has  been  healed,  the 
subjective  troubles  often  continue  for  a  comparatively  long  time, 
.  .  .  The  single  and  sole  cause  of  this  is  the  prospective  at- 
tainment of  a  pension."  On  the  other  hand,  of  the  non-insured 
injured,  he  says :  "The  striking  fact  common  to  all  these  cases  is 
that,  in  spite  of  the  injuries  received,  ability  to  work  to  full 
capacity  is  found  to  exist,  and  that  the  patients  were  receiving 
no  pensions  because  not  included  within  the  provisions  of  the 
accident  insurance  law." 

Moreover,  surgeons  speak  of  the  numerous  cases,  in  which 
co-operation  on  the  part  of  the  patients  is  necessary  in  order  to 
effect  speedy  cures  (especially  cases  of  broken  or  dislocated 
limbs).  Since  we  have  had  workingmen's  compensation  insur- 
ance, the  co-operation  of  the  injured  has  often  been  wanting. 
Indeed,  the  insured  even  go  so  far  as  to  endeavor  to  thwart  the 
success  of  the  treatment  (e.  g.,  where  ability  freely  to  move  a 
broken  limb  is  sought). 

Surgical  literature  abounds  in  evidence  corroborative  of  this 
assertion.  Thus,  for  example,  H.  Liniger,  in  an  article  which 
bears  the  descriptive  title  of  "Thigh  Fractures  and  Accident 
Insurance," (2)  wrote: 

"In  the  case  of  individuals  who  have  no  expectation  of  a 
pension  the  best  possible  result  is  attained  in  the  briefest  time 
through  the  necessity  of  having  to  work,  through  the  satisfaction 
derived  from  the  progressive  healing  and  through  constant,  vol- 
untary exercising.  .  .  .  When  it  comes  to  those  entitled  to 
compensation,  the  results  as  regards  the  ability  to  earn  a  living 
are  entirely  different.  The  secret  desire  to  secure  the  highest 
possible  indemnity  for  the  accident — even  though  it  be  at  the  ex- 
pense of  the  employers'  association  or  of  an  insurance  company — 
is  only  too  apt  to  awaken  in  the  mind  of  the  insured  the  mistaken 
notion  that,  because  the  accident  has  occurred  and  because  the 
results  thereof  can  hardly  be  done  away  with  entirely,  not  he 
himself  but  the  insurers  are  chiefly  interested  in  the  restoration 
as  far  as  possible  of  former  full  earning  capacity.  The  highly 
valuable  co-operation  with  the  treatment  which  we  note  with  non- 
insured  patients,  diminishes  very  considerably  in  these  cases, 
especially  with  older  patients,  up  to  entire  passivity." 

Grunewald  complains  of  the  fact  that  since  we  have  had 
a  system  of  workingmen's  compensation,  healing,  where  accom- 

0)  Sanger:  Die  Beurteilung  der  Nervenerkrankungen  nach  Unfall. 
1896,  p.  61.  "The  sick  list  of  the  Hamburg  Seaman's  Hospital  is  recruited 
from  countries  in  which  the  benefit  of  a  system  of  social  insurance  legis- 
lation, with  compulsory  compensation  of  accidents,  has  not  yet  been 
secured." 

(2)  Archiv  fur  Orthopadie,  Mechanotherapie  und  Unfallchirurgic, 
Jahrgang  1907,  p.  123. 

46 


modation(1)  has  to  be  resorted  to,  has  become  very  much  more 
difficult. 

''The  injured  man  is  himself  aware  of  it  and  knows  quite 
well  that,  although  this  or  that  part  of  his  body  is  missing,  he 
can  perform  just  as  much  work  as  formerly.  But,  influenced  as 
he  is  by  the  accident  insurance  law,  as  is  well  known,  it  very 
seldom  occurs  that  he  really  concedes  the  fact."(2) 

This  phenomenon  exerted  such  an  influence  that  surgeons  were 
compelled  completely  to  revise  the  data  they  had  previously  ac- 
quired concerning  the  length  of  time  needed  for  the  healing  of 
broken  or  dislocated  limbs.  In  spite  of  the  improvement  in  heal- 
ing methods,  the  prospects  of  recovery  became  appreciably  much 
worse.  For  example,  Dittmer,  in  an  article  entitled  "Concerning 
Shoulder  Injuries  Considered  in  Connection  with  Accident  In- 
surance Legislation," (3)  established  the  fact  that  fractures  of  the 
collar  bone  had  to  be  treated  for  a  period  of  eight  months.  On 
this  point  he  observed :  "If  we  compare  with  this  the  prognosis  to 
be  found  in  the  text  books  and  if  we  cite  HofTa,  who  represents 
the  most  recent  views  and  those  recognized  up  to  this  time  as  the 
most  authoritative,  we  find  this  statement  made:  'As  regards  the 
time  of  healing,  the  prognosis  of  all  fractures  of  the  collarbone 
is  a  very  favorable  one.  A  healing  is  attained  in  from  15  to  20 
days  in  the  case  of  children  and  in  from  20  to  40  days  in  the  case 
of  adults.' '  Dittmer  further  cited  a  sentence  of  Bardenheuer : 
"A  fracture  of  the  collarbone  heals — without  any  functional  dis- 
turbance remaining — in  from  15  to  20  days  in  the  case  of  chil- 
dren, and  in  from  20  to  40  days  in  the  case  of  adults."  Dittmer 
then  wrote:  "If  we  are  to  draw  a  resume,  we  can  say  that  the 
prognosis  heretofore  deemed  correct,  but  which  was  arrived  at 
without  considering  the  results  in  insured  accident  cases,  has  been 
stated  entirely  too  favorably,  both  as  regards  the  length  of  time 
required  as  well  as  in  degree  of  healing." 

Concerning  shoulder  blade  injuries,  Dittmer  remarked :  "Every 
single  case  cited  contradicts  the  favorable,  or  relatively  favorable, 
prognosis  concerning  the  use  of  the  arm,  which  is  given  in  almost 
all  the  text  books."  Through  an  examination  of  dislocations  of 
the  bone  of  the  upper  arm,  he  arrives  at  the  following  conclu- 
sion :  "Even  where  the  bone  has  been  successfully  set,  we  are  un- 
able to  find  any  confirmation  of  the  generally  favorable,  or  at 
least  fair,  prognosis  stated  in  the  text  books."  Finally,  con- 
cerning fractures  of  the  upper  arm  bone,  he  says :  "While  in  the 


0)  In  cases  where,  as  the  result  of  an  accident,  the  use  of  a  muscle 
is  entirely  lost,  whether  through  being  severed  or  through  a  nerve  be- 
coming paralyzed,  other  muscles  can,  under  certain  circumstances,  be  sub- 
stituted for  the  one  disabled.  This  method  of  healing  is  termed  in  sur- 
gery "accommodation." 

(2)  Grunewald :     Ueber  Anpassung  an  Funktionsausfalle  nach  Un- 
fallerkrankungen.     Archiv  fur  Orthopadie  et  cet.  1911,  p.  7. 

(3)  Archiv  fur  Unfallheilkunde  Gewerbehygiene  und  Gewerbekrank- 
heiten  for  1896,  p.  177  et  seq. 

47 


text  books  30  to  40  days  is  stated  to  be  the  time  needed  for  a  suc- 
cessful healing,  in  these  cases  we  find  an  approximately  sufficient 
use  of  the  arm  occurs  at  the  very  earliest  after  a  period  of  four 
months." 

The  following  also  coincides  with  these  conclusions.  Profes- 
sor Korteweg,  who  is  the  one  in  Holland  best  acquainted  with 
accident  insurance  matters,  reports (*)  that  previous  to  the  intro- 
duction of  accident  insurance  legislation  (before  1901),  disloca- 
tions and  fractures  healed  much  more  quickly  in  Holland  than  in 
Germany.  The  Dutch  physicians  were  at  that  time  astonished 
to  learn  how  long  it  took  in  Germany  for  an  insured  workman 
to  recover  from  a  shoulder  dislocation  or  a  broken  leg.  When, 
however,  Holland  also  passed  an  accident  insurance  law  based  on 
the  German  system,  recoveries  took  a  longer  and  longer  time. 
Although  methods  of  treatment  have  in  the  last  decade  particu- 
larly been  very  considerably  improved,  a  much  longer  period  has 
to  be  allowed  for  recoveries  from  dislocations  and  fractures. 

In  Austria,  a  physician  made  a  comparison (2)  based  on  rail- 
way reports  of  the  decade  before  accident  insurance  took  effect 
(previous  to  1895)  with  the  decade  thereafter.  In  the  first  de- 
cade 0.26%  of  those  injured  became  totally  disabled  and  1.58% 
semi-invalided.  On  the  other  hand,  in  the  second  decade  6.6% 
of  those  injured  became  totally  disabled  and  2.4%  semi-invalided. 

"But  this  is  not  the  only  difference  to  be  observed  between 
the  two  periods."  In  the  first  decade,  "not  a  single  person  in- 
jured became  unable  to  work  or  to  follow  his  profession  in  con- 
sequence of  a  nervous  ailment/'  But  in  the  second  decade,  "in 
the  majority  of  cases  the  only  troubles  existing  were  nervous, 
without  any  trace  of  bodily  injury.  These  formed  also  more  than 
half  the  percentage  of  those  totally  disabled;  for  cases  of  total 
disability  caused  by  bodily  hurts  scarcely  equaled  1.25%." 

Professor  Zingerle  (Graz)  also  calls  attention  to  the  "more 
unfavorable  results  in  the  line  of  healing  and  the  increasing  fre- 
quency of  nervous  diseases  coincident  with  the  taking  effect  of 
the  law."  (3) 

Furthermore,  comparisons  made  between  German  experience 
on  the  one  side  and  Swiss  and  Danish  experience  on  the  other 
are  most  instructive.  In  Switzerland,  an  effort  has  been  made 
to  interpose  a  timely  barrier  to  pension  hysteria  by  paying  lump 
sum  indemnities  instead  of  pensions.  And  what  has  been  accom- 
plished thereby  is  that  almost  all  nervous  "consequences  of  acci- 


0)  "De  Inyloed  van  de  Ongevallenwct  op  de  Genezing  van  Trauma- 
tische  Beleedigingen"  in  the  Nederlandsch  Tijdschrift  voor  Geneeskunde 
1908  No.  21. 

(2)  Braun:  Praktische  Erfahrungen  iiber  die  traumatische  Neurose 
vor  und  nach  der  Schaffung  des  Ausdehnungsgetzes  der  Unfallversicher- 
ung.  Prager  med.  Wochenscrift  April,  1907. 

(8)     Monatsschrift  fur  Unfallheilkunde  1911,  No.  9. 


dents"  have  been  done  away  with.^1)  A  similar  state  of  affairs  is 
reported  from  Denmark,  where  likewise  a  lump  sum  settlement 
is  substituted  for  pension  payments,  and  where  Wimmer's  investi- 
gation showed  that  93.6%  of  all  observed  cases  were  cured.  (2) 

What  a  contrast  that  is  to  conditions  in  Germany,  where  an 
investigation  carried  out  on  the  same  basis  by  Schaller  showed 
only  9.3%  of  cures  !(s) 

Besides  these  international  comparisons,  other  facts  have  come 
to  light,  which  arouse  also  the  suspicion  that  workingmen's  in- 
surance is  of  itself  an  agent  provocateur  of  nervous  diseases. 
Thus  for  example,  neuroses  are  very  seldom  observed  after  stu- 
dents' duels  ;(4)  also  very  seldom  where  officers,  who,  ordered  to 
a  riding  school,  are  there  subject  to  severe  accidents, (5)  and 
equally  seldom  after  accidents  incurred  in  sports. (6) 


CHAPTER  III. 

SIMULATION. 

When  the  serious  after  effects  of  workingmen's  compensation 
insurance  were  first  discussed,  Friedrich  Schultze  (of  Bonn), 
Lenhartz,  Unverricht,  Blasius,  and  Seeligmiiller  asserted  that 
simulation  by  the  insured  occurred  very  frequently.  The  espe- 
cially grotesque  cases  of  simulation  were  publicly  made  known. 
Naturally  it  was  soon  proposed  to  supplement  the  insurance 
laws  with  penal  provisions, (T)  which  should  prevent  any  misuse 
of  the  statutes. 

The  Swiss  Federal  law  concerning  sickness  and  accident  in- 
surance contains  in  Article  99  this  provision:  "Whoever  obtains, 
or,  seeks  to  obtain,  or  is  helpful  in  obtaining,  by  fraudulent 
means,  the  payment  of  indemnities  which  are  not  really  due  or 
owing  shall  be  turned  over  for  punishment  to  the  criminal  judge 
of  the  Canton."  Similarly,  according  to  a  provision  of  the  crimi- 
nal code,  simulation  can  be  treated  as  fraud  in  Germany.  Re- 


0)     See   Nageli  im   Korrespondenzblatt   fur  Schweizer  Aerzte  1910, 
No.  2. 

(2)  Wimmer     (Kopenhagen)  :     Die     Prognose     der     traumatischen 
Hysteric  und  ihre  Beeinflussung  (lurch   die   Kapitalabfindung.     Zentral- 
blatt  f.  Nervenheik.  u.  Psych.  1910,  p.  117. 

(3)  Schaller:    Einige  Zahlen  uber  Unfallnettrose,  Rente  und  Kapi- 
talabfmding.     Stuttgart,   1910. 

(4)  Windscheid:    Der  Einfluss  der  Entschadigungsart  auf  den  Ver- 
lauf  der  sogenannten  Unfallneurosen.    Zeitschr.  f.  Versicherungsmedizin 
1910.     Book  4. 

(6)     Bruns:    Die  traumatischen  Neurosen.     Nothnagel.    Vol.  12,  p.  23. 

(6)  Hoche:    Notwendige  Reformen  der  Unfall  versicherungsgesetze, 
1907. 

(7)  The  chief  advocate  of  this  suggestion  was  Seeligmuller,  whose 
writings  are  cited  on  another  page. 

49 


cently  this  possibility  has  been  made  use  of^1)  But,  the  facts 
hereinafter  recited  will  show  that  one  cannot  rely  on  attaining 
any  great  success  through  resorting  to  criminal  laws. 

As  far  as  one  can  speak  of  a  prevailing  opinion  as  regards  this 
much  debated  subject,  (2)  the  fact  is  generally  accepted  today  that 
cases  of  "out  and  out"  simulation  are  comparatively  rare.  "Some- 
thing tangible,"  rather,  is  to  be  found  at  the  bottom  of  most  imagi- 
nary diseases.  On  the  other  hand,  the  deliberate  false  dating 
back  of  ailments  to  the  time  of  the  occurrence  of  an  accident 
("simulation  of  the  causal  connection")  is  said  to  be  very  fre- 
quent. From  a  practical  standpoint,  it  is  of  decisive  importance 
whether  disorders  of  any  kind  already  existed,  previous  to  the 
time  of  the  accident,  or  whether  they  are  to  be  ascribed  to  the 
accident.  As  regards  invalidity  insurance,  it  is  likewise  important 
whether  the  illness  made  its  first  appearance  a  long  time  ago 
or  not. 

The  insured,  therefore,  seek  to  so  fix  the  date  of  their  troubles, 
aches  and  stiff-joints,  that  the  highest  possible  pension  must 
be  awarded  to  them.  Only  with  great  difficulty  can  the  physician 
prove  with  certainty  such  simulation  of  the  causal  connection, 
which  is  often  carried  on  with  subtlety.  Proof  of  simulation  be- 
comes "almost  impossible  in  all  those  cases  in  which  the  patient 
asserts  a  previously  existing  complaint  to  have  been  made  de- 
cidedly worse  as  the  result  of  the  accident."  "In  these  cases  only 
very  seldom  will  one  succeed  in  proving  the  bad  faith  of  the 
party  examined. (3) 

Altogether  the  insured  laborers  find  themselves  in  an  espe- 
cially "favorable"  position  in  the  domain  of  simulation,  indeed 
I  might  almost  say,  in  an  unassailable  position.  Exactly  those 
disability  features,  which  especially  affect  the  "working  capacity" 
of  the  factory  hand,  are  so  easy  to  simulate  that  proof  of  decep- 
tion fails. (4)  This  is  true  above  all  of  the  simulation  of  weak- 
ness of  the  movable  parts  of  the  body.  Weakness  in  the  move- 
ment of  the  fingers,  in  the  arms  and  in  the  legs,  and  weakness 
of  the  powers  of  resistance  cause  the  physicians  especial  trouble, 
and  the  most  varied  kind  of  examining  methods  have  been  de- 


0)  Thus,  for  example,  the  periodical  Die  Berufsgenossenschaft  in 
its  No.  6  for  1912  speaks  of  two  such  decisions  in  the  criminal  courts. 
In  one  case,  an  insured  workman  received  six  weeks'  imprisonment  for 
attempted  fraud,  committed  by  acts  the  purpose  of  which  was  the  at- 
tainment of  a  pension. 

(2)  If  I  may  call  attention  to  what  is  self-evident,   all   "statistical 
determinations"   regarding  the   frequency  with  which  simulation  occurs, 
are  merely  tables  of  figures  of  how  often  cases  of  simulation  have  been 
detected.     Inasmuch  as,  according  to  the  opinion  of  physicians  most  ex- 
perienced  in  accident  practice,  there   are  numerous   cases  in  which   the 
detection  of  simulation  is  either  impossible  or  else  seldom  occurs    (see 
the  next  following  pages),  one  cannot  properly  speak  of  "determinations" 
in  a  strict  statistical  sense.     President  Kaufmann,  of  the  Imperial  insur- 
ance office,  has  disregarded  this  fact  in  his  address:    Licht  und  Schatten 
bei  der  Arbeiterversicherung,  1912,  p.  12. 

(3)  Schuster,  previously  cited. 

(4)  Schuster,  p.  14  et  seq. 

50 


vised  for  the  purpose  of  catching  suspected  patients.  But,  in 
workingmen's  circles,  they  are  equally  indefatigable,  and  the 
symptoms  are  known  by  which  one  "reaches  the  goal."  For  ex- 
ample, in  Upper  Silesia  there  are  experienced  recipients  of  pen- 
sions who  actually  give  instruction  in  the  simulation  of  traumatic 
neurosis.  And  even  if  "instruction"  is  not  directly  imparted, 
conditions  are  such  that  the  German  workman  finds  everywhere 
an  opportunity  of  "posting  himself." 

In  this  respect,  the  policlinics,  where  the  ailing  person  has 
to  wait  with  other  injured  and  sick  patients  in  an  ante-room  for 
hours  at  a  time,  appear  to  exercise  the  worst  influence.  "Hardly 
a  more  favorable  opportunity  than  this  could  be  found  for  the 
newcomer  in  the  sphere  of  accident  neurosis  to  be  overwhelmed 
with  the  most  dire  predictions  on  the  part  of  the  old  neurotics 
there  present.  These  latter  inform  him  concerning  the  peculiari- 
ties of  this  physician,  who  is  favorably  disposed  to  the  working- 
man,  and  of  that  doctor,  whom  one  can  only  impress  by  exhibiting 
the  most  severe  symptoms,  make  clear  to  him  both  the  agreeable- 
ness  of  drawing  a  pension  as  contrasted  with  hard  daily  work, 
and  also  the  tricks,  exaggeration  and  simulation  needed  to  se- 
cure and  to  retain  a  pension."  (a)  Indeed,  hospitals  for  the  treat- 
ment of  accidents  have  been  termed  "high  schools  in  the  art  of 
simulation." 

The  foregoing  explains  why  everyone  who  comes  into  touch 
with  workingmen's  circles  finds  the  laborers  in  receipt  of  pecu- 
liar information,  which  the  investigator  would  not  have  suspected 
them  of  possessing.  The  workmen  are  thoroughly  familiar  with 
"the  tricks  of  the  doctors,"  that  is,  the  methods  which  are  termed 
"feigned  examinations"  in  medical  literature.  Thus,  for  example, 
a  workman  who  has  had  some  experience  in  these  matters  and 
who  is  desirous  of  re-producing  a  weakness  of  the  legs,  will  not 
let  himself  be  caught  by  the  fact  that  the  doctor  is  apparently 
making  an  examination  of  the  stomach.  The  workman  always 
counts  on  the  possibility  of  the  doctor's  only  making  use  of  the 
positions  and  movements  required  in  such  examination  for  the 
purpose  of  informing  himself  concerning  the  strength  of  and  the 
ability  to  move  the  legs. 

Besides  simulation  of  the  causal  connection  and  simulation 
of  weakness,  there  is  still  a  third  sub-division,  which  is  of  especial 
importance  in  workingmen's  insurance,  namely,  simulation  of 
pain.  Thus,  for  example,  the  strikingly  excessive  overburden- 
ing of  the  sickness  societies  and  insurance  institutions  with  stom- 
ach troubles  and  intestinal  disorders,  is  to  be  explained  by  the 
fact  that  a  subject  is  here  involved  in  which  the  doctor  has  no 
objective  criterion  for  determining  a  cure.  Often  only  the  sub- 
jective statements  of  the  patients  (disappearance  of  feelings  of 
apprehension  or  ot  pain)  furnish  any  clue.(2) 

0)  Jacoby :  Zur  Verhutung  des  Ensteheus  von  Unfallneurosen, 
elsewhere  cited,  p.  382. 

(2)     Perntz.    Zeitschrift  fur  soziale  Medizin.     Vol.  4,  Book  1,  p.  104. 

51 


It  is  so  difficult  to  prove  simulation  of  pain  after  an  accident 
that  Schuster,  a  well  posted  informant,  made  the  following  state- 
ment in  reference  thereto  in  the  seminary  for  social  medicine  in 
Berlin :  "For  the  patient,  the  simulation  of  pain  is  the  most  invit- 
ing form  of  simulation.  It  is  especially  inviting  because  it  causes 
the  least  difficulty  to  the  one  being  examined  and  because  convic- 
tion of  it  is  absolutely  impossible  to  secure."  (1) 

It  is  easy  to  understand  why  the  most  astonishing  occurrences 
should  take  place  under  these  conditions.  I  need  only  recall 
the  cases  of  one  workman  who  received  a  pension  of  50%  from 
Berlin  on  account  of  a  sensitive  scar  until  it  was  accidentally  dis- 
covered that  the  patient,  "who  was  unable  to  move,"  was  acting 
as  a  teacher  of  breathing  exercises,  and  of  another,  who  received 
a  pension  on  account  of  inability  to  move  the  elbow  joint  freely, 
until  one  day  the  fact  was  established  that  he  had  vanquished  the 
celebrated  A,  in  a  public  boxing  contest. (2) 

When  such  or  similar  cases  as  these  become  publicly  known, 
the  canny  simulator  often  has  the  laugh  on  his  side,  and  the  doc- 
tors are  given  the  well  meant  advice  to  perfect  their  methods  of 
examination.  In  giving  this  advice,  however,  one  overlooks  the 
fact  that  the  conscientious  physician  has  to  stop  at  a  line  which 
nature  has  drawn  for  him,  since  he  knows  that  those  suffering 
from  hyteria  often  react  when  examined  exactly  as  those  simulat- 
ing. Thus  Schuster  warns  the  physicians  against  declaring  sway- 
ing in  a  marked  degree,  accompanied  by  a  clumsy  kind  of  falling, 
te  be  purely  simulated  because  "it  appears  too  odd  and  grotesque 
and  as  though  made  to  order,"  for  the  reason  that  the  hysterical 
often  make  the  same  impression  when  they  are  examined.  In- 
deed, there  is  hardly  a  symptom  which  cannot  be  observed  in  the 
hysterical  just  as  well  as  in  the  simulators.  "The  most  ingenious 
apparatuses  and  methods  have  been  invented  by  means  of  which 
the  falsity  of  a  patient's  statements  are  to  be  shown.  All  these 
methods  have  this  drawback  that  they  can  reveal  the  same  ap- 
parently unmasking  result  both  in  the  case  of  the  hysterical  and 
of  the  simulators." (3)  And  it  seems  hardly  possible  for  this 
difficulty  to  be  overcome,  because  there  is  no  sharply  defined  line 
of  division  between  the  actions  of  those  afflicted  with  hysteria 
and  of  those  attempting  simulation,  that  is,  between  conscious  and 
unconscious  actions. 

All  this  uncertainty  prevails  in  a  still  more  marked  degree 
in  those  cases  in  which  the  sick  person  attempts  to  deceive  by 
exaggeration  (aggravation).  The  exaggeration  of  subjective 
troubles  and  the  exaggeration  of  objective  symptoms  both  cause 
the  doctors  much  difficulty.  In  this  respect,  workingmen's  insur- 
ance has  produced  some  new  features.  Whereas  the  non-insured 


(*)     Schuster:    Drei  Vortrage  aus  dem  Gebiet  der  Unfallneurologie, 
Leipzig,  1910,  p.  22. 

(*)     Blasius,  Monatsschrift  fur  Unfallheilkunde.    Vol.  1,  p.  53. 
(3)     Schuster,  before  cited,  p.  22. 

52 


sick  man  has  an  eager  desire  to  get  well,  this  desire  is  diminished, 
if  indeed  not  entirely  done  away  with,  in  the  case  of  the  insured, 
by  the  desire  to  obtain  a  pension. 

This  danger  is  increased  by  the  evil  that  the  insured  almost 
always  learns  the  contents  of  the  physician's  reports  in  the  course 
of  his  suit  for  a  pension,  either  during  the  public  hearing  or 
through  the  judicial  decision.  "In  these  reports,  he  has,  so  to 
speak,  the  particulars  of  his  ailment  down  in  black  and  white. 
He  is  able  to  fortify  and  strengthen  the  positive  findings,  whether 
consciously  or  unconsciously,  and  learns  from  the  negative  find- 
ings what  symptoms  are  lacking  for  the  attainment  of  a 
neurosis. "O) 

Finally,  to  these  varied  forms  of  simulation  and  aggravation, 
are  to  be  added  all  those  cases  in  which  the  ailing  party,  through 
worrying  about  his  pension,  "imposes  on  himself  an  accident 
neurasthenia," (2)  without  one  being  able  to  say  to  what  extent 
he  was  consciously  aware  of  it.  Naturally  the  physician  will  in 
such  an  instance  reserve  his  opinion  entirely,  for,  "where  there  is 
brooding  over  the  results  of  an  accident,  no  one  is  in  a  position  to 
decide  at  what  point  bad-faith  began. "(3) 


CHAPTER  IV. 

PENSION    MANIA    AND    ITS    WIDESPREAD    DISSEMINATION. 

The  more  closely  physicians  studied  the  vanishing  boundary 
between  hysteria  and  simulation  and  the  greater  grew  the  amount 
of  material  collected,  the  more  pronounced  became  the  conviction 
that  a  much  greater  importance  was  attributable  to  nervous  "pen- 
sion sick  cases"  than  to  cases  of  simulation;  and  today  one  no 
longer  doubts  that  a  danger  is  to  be  found  in  the  spread  of  these 
hysterical,  neurasthenic  and  hypochondriac  symptoms. 

"The  now  well-known  course  is  that  after  an  accident,  which 
can  be  as  small  and  unimportant  as  one  likes,  nervous  troubles  of 
the  most  varied  kind  appear,  joined  with  a  hypochondriac  ill- 
temper,  which  makes  the  one  afflicted  incapable  of  work,  and,  at 
the  same  time,  secures  for  him,  under  the  law,  the  right  of  draw- 


0)  The  Imperial  Insurance  Office  has  decided  that  all  those  por- 
tions of  the  reports  are  to  be  given  out  to  the  parties  "on  which  the 
court  rendering  the  decision  laid  stress  and  which  had  to  be  made  use 
of  in  drawing  up  the  decision."  On  the  other  hand,  paragraphs  need 
not  be  imparted  which  "contain  information  of  a  disturbing  nature  for 
the  insured,  and  the  imparting  of  which  is,  as  a  matter  of  fact,  unneces- 
sary." Among  physicians  scarcely  any  difference  of  opinion  exists  that 
the  imparting  of  the  contents  of  medical  reports  to  the  nervously  sick 
ought  to  be  suppressed.  To  the  extent  that  this  should  not  prove  prac- 
ticable, the  physicians  demand  that  the  extracts  from  the  reports  should 
be  prepared  by  physicians  and  not  by  jurists. 

(2)     Striimpell. 

(8)  Hoche.  Notwendige  Reformen  der  Unfallversicherungsgesetze, 
p.  16. 

53 


ing  a  pension  measured  according  to  his  condition.  Simulation 
and  intentional  deception  regarding  non-existent  ills  are  not  in 
question,  as  was  originally  supposed.  The  individuals  are  really 
ill,  but,  strange  to  say,  they  would  be  well  if  the  law  were  not  in 
existence.  The  inner  connection  here  is  this :  The  fact  of  being 
insured  and  having  the  right  to  draw  a  pension  and  even  more 
(what  helps  to  reinforce  the  suggestive  effect)  the  talk  of  wives 
and  comrades  direct  the  attention  in  hypochondriac  fashion  to  the 
state  of  the  body,  so  that  the  educational  factor  of  necessity  is 
done  away  with  as  well  as  the — for  nervous  individuals — curative 
and  needed  obligation  of  pulling  themselves  together  and  of  over- 
coming small  ailments  by  ignoring  them."^) 

In  the  foregoing,  Hoche  speaks  of  a  disease  which  is  caused 
by  the  law.  This  sounds  paradoxical;  but  its  confirmation  is  to 
be  found  in  the  recent  Dutch  literature  on  the  subject,  in  which 
the  physicians  expressly  differentiate  between  an  "accident-law 
neurosis"  and  an  "accident  neurosis." (2)  Not  only  does  this 
disease  occur  as  a  result  of  accident  insurance,  but  also  "exactly 
similar  conditions  are  to  be  found  in  the  case  of  persons  who  seek 
or  have  received  pensions  under  the  invalidity  pension  law."(3) 

The  accident  insurance  law  and  its  results  occupies  a  more 
prominent  place  in  the  discussion  because  the  comparatively  higher 
pensions  in  this  branch  prove  a  more  attractive  "enticement." 
The  accident  results  also  occupy  a  more  prominent  place  in  medi- 
cal publications  because  the  observation  of  these  disabilities  has 
given  rise  to  animated  professional  controversies. 

This  question  of  the  results  of  insurance  laws  becomes  pecu- 
liarly acute  through  the  fact  that  what  affects  the  individual  most 
of  all  in  this  matter,  namely  his  bodily  state  of  health,  is  brought 
into  direct  contact  with  the  great  political  agitation  of  our  day. 
A  sociologist  has  recently  stated  that  the  modern  state  is  about 
to  be  metamorphosed  into  an  "insurance  community"  and  that 
this  occurrence  could  be  seen  to  be  in  response  to  the  demands  of 
the  age.  This  is  not  the  place  to  speak  of  the  dangerous  error 
contained  in  that  alluring  idea.  But  it  is  certainly  a  fascinat- 
ing idea,  and,  when  bluntly  expressed,  eminently  suited  to  fire  the 
masses.  Every  parliamentary  session  at  which  workingmen's  in- 
surance is  discussed,  every  electoral  campaign,  every  discussion 
of  these  questions  in  the  workingmen's  meetings  proves  the  truth 
of  this  assertion. 

Thus  the  workman,  who  really  only  desired  to  have  his  trouble 
cured,  learns  that  this  purely  personal  matter  has  become  a  topic 
of  public  discussion  of  the  utmost  importance.  Through  public 
social-polity  debates,  he  is  informed  that  he  is  in  danger  of  being 


C1)     Hoche,   Geisteskrankheit  und   Kultur,   p.  25   et  seq. 

(2)  The  "accident-law  neurosis"  is  differentiated,  for  example,  from 
the  "accident  neurosis"  in  the  Nederlandsch  Tijdschrift  voor  Geneeskunde, 
of  August  20th,  1910. 

(8)     Sachs,  cited  elsewhere,  at  p.  42. 

54 


cheated.  From  the  speeches  of  his  parliamentary  representatives, 
he  learns  that  the  judicial  decisions  of  the  Imperial  Insurance 
Office  "have  grown  steadily  worse,"  that  "an  absolutely  unlawful 
suppression  of  pensions"  is  taking  place  and  that  the  highest 
court  of  appeals  in  workingmen's  insurance  matters  has  been 
guilty  of  "an  infringement  of  the  law."(x) 

Such  communications  and  assertions  are  then  spread  widecast 
by  the  labor  press  as  proven  facts,  and  the  workmen  are  thereby 
constantly  more  convinced  that  they  are  being  deprived  of  their 
lawful  rights  and  that  it  is  simply  a  justifiable  form  of  defense,  if, 
through  all  sorts  of  ways  and  means,  they  manage  to  "exert  some 
sort  of  influence"  when  it  comes  to  the  determination  of  their 
pensions. 

Imbued  with  this  conviction,  the  workmen  turn  to  pettifogging 
lawyers,  the  so-called  "people's  attorneys,"  who  offer  their  serv- 
ices on  every  hand  in  boastful  newspaper  advertisements. 

These  first  of  all  call  to  the  attention  of  those  seeking  advice 
the  fact  that  they  have  to  pay  "the  people's  attorney"  a  fee,  because 
in  all  other  respects  the  various  proceedings  in  a  suit,  including 
the  different  forms  of  appeals,  can  be  carried  on  entirely  free  of 
charge.  (2) 

For  years  past,  medical  publications  have  been  full  of  com- 
plaints of  what  a  pernicious  influence  is  being  exerted  by  these 
pettifogging  lawyers  (also  by  the  secretaries  of  the  workingmen's 
organizations),  of  how  they  stimulate  the  mania  for  litigation  and 
simulation  and  how  they  "suggest"  the  pension  mania  to  the 
laborer's  mind.(3)  Thus  the  physicians  call  attention  to  the 
fact  that  the  workmen,  who  generally  have  their  applications  pre- 
pared by  these  pettifogging  lawyers,  are  "spurred  on."  It  is  "ex- 
plained to  them  that  it  is  the  solemn  duty  and  obligation  of  the 
state  to  pay  a  handsome  indemnity."  At  the  same  time,  these 
shyster  lawyers  often  proceed  with  considerable  unscrupulousness 
and  write  down  the  subjective  statements  of  the  insured  "without 
looking  into  the  documents  in  the  case  or  the  individual's  mental 
qualities."  It  often  appears  that  the  workman  was  satisfied  with 
the  pension  allotted  him,  but  was  driven  by  his  "lawyer  into  bring- 
ing a  suit,  in  which  event  everything  depended  on  appearing 
as  ailing  as  possible." 

These  influences,  which  no  kind  of  legislation  can  do  away 
with  and  which  are  becoming  constantly  more  effective  and  more 
threatening  the  more  "the  modern  state  is  changed  into  an  in- 
surance community,"  are  unavoidably  reinforced  by  the  incite- 
ment exerted  by  the  sick  man's  surroundings.  "It  is  natural  for 


0)     One   should   read   the    Reichstag   debates   on   the    Imperial   In- 
surance Office  budget,  especially  the  debate  of  March  21st,  1912. 

(2)  See  chapter  5  concerning  appeals  free  of  charge. 

(3)  In  order  to  quote  only  a  few.  compare  for  example  the  writ- 
ings already  cited  of  Sanger   (p.  51),  Jacoby   (p.  381),  Laquer   (p.  8), 
Kuhne  (p.  40(f). 

55 


relatives  and  friends,  belonging  to  the  same  grade  of  society  as 
the  insured  and  imbued  with  the  same  views,  to  aid  him  in  his 
struggle  for  a  pension  and  not  to  weaken  but  rather  to  strengthen 
his  morbid  ideas.  In  the  opinion  of  almost  all  writers,  the  women 
are  the  strongest  impelling  force ;  friends  and  relatives  engage  in 
a  sort  of  officious  competition  to  depict  to  the  injured  man  in  as 
severe  a  light  as  possible  the  results  of  an  accident."  (x)  Con- 
sequently "he  watches  himself  day  and  night,  every  ache,  every 
weakness  and  every  attack  of  dizziness  is  noted,  highly  colored 
and  magnified." (2).  The  insured  "devote  their  whole  attention 
to  the  state  of  their  bodies  and  to  the  symptoms  of  their  illness. 
.  «  .  Their  morbidly  increased  powers  of  imagination  cause 
them  to  depict  their  ailments  in  the  very  darkest,  and  the  longed 
for  period  when  they  are  to  be  recipients  of  a  pension  in  the  very 
rosiest  colors."  They  devote  "an  extraordinary  amount  of  atten- 
tion to  the  peculiar  symptoms  of  and  to  what  takes  place  in  their 
own  bodies.  Whatever  appears  as  not  quite  normal,  and  to  which 
the  attention  of  the  insured  was  in  many  cases  first  directed  at  the 
time  of  the  physician's  examination,  is  thereafter  dwelt  upon  as 
the  symptom  of  a  diseased  condition.  Indeed,  a  hypochondriac 
use  is  made  of  quite  normal  physiological  occurrences,  which  in 
some  way  or  another  have  come  to  the  knowledge  of  the  patient." 

Generally  all  this  is  unconsciously  evolved ;  and  the  fact  cannot 
be  too  strongly  emphasized  that  the  insured  is  far  from  starting 
with  the  idea  of  exploiting  the  accident  that  has  befallen  him. 
Of  course,  this  excuses  the  individual;  but  the  social  danger  is 
thereby  just  the  more  increased.  For  the  individual  is  influenced 
by  the  general  trend  of  thought,  which  has  spread  in  every  direc- 
tion among  the  people  and  which  one  of  those  best  acquainted 
with  this  phase  has  described  as  follows : 

"Through  the  results  of  social  insurance  legislation  visible  on 
every  hand  and  particularly  through  the  receipt  of  money  pay- 
ments, the  suits  to  enforce  employers'  liability  and  the  extension 
of  private  accident  insurance  companies,  the  belief  in  the  right 
to  compensation  has  become  a  living  doctrine  among  the  people. 
Especially  general  has  become  the  idea  that  the  occurrence  of  an 
accident  carries  with  it  the  right  to  compensation ;  that  the  injured 
party  has  the  right  to  the  highest  possible  compensation;  that 
every  reduction  of  an  indemnity  is  an  act  of  injustice  on  the  part 
of  the  employers'  association ;  and  that  plenty  of  money  is  avail- 
able but  that  the  employers,  who  constitute  the  members  of  the 
associations,  simply  do  not  wish  to  pay.  On  the  one  hand,  there 
is  the  poor  and  injured  victim  undergoing  pain  and  misery  and, 
on  the  other  hand,  the  wealthy  factory  owners  who  are  included 
in  the  employers'  associations.  These  are  the  things  which  exer- 
cise a  controlling  influence  on  the  individual's  line  of  thought  and 
which  cause  him  to  act,  without  serious  reflection,  in  accordance 

(*)     Jacoby,  cited  elsewhere,  p.  381. 
(2)     Hellpach,   Rentenhysterie,   p.   276. 

56 


with  what  he  himself  has  come  to  believe  to  be  the  definitely  ac- 
cepted doctrine  derived  from  general  experience."  (*) 

Political  economists  have  probably  paid  little  attention  to 
the  social  danger  herein  contained,  because  ostensibly  it  has  been 
"statistically  proven"  that  traumatic  neurosis — the  best  known 
form  of  "pension  hysteria" — only  very  seldom  occurs. 

In  1904,  Dr.  Paul  Biss  published  "Contributions  Based  on 
Practical  Experience  of  the  Question  of  Traumatic  Neurosis," (2) 
which  he  supplemented  by  an  article  appearing  in  1910  (3) 

In  his  article  Biss  communicates  the  following  results.  He 
found : 

1.  Only  24  instances  of  accident  neurosis  among  9,000  acci- 
dent cases  in  the  Seamen's  Employers'  Association. 

2.  Only  7  instances  of  accident  neurosis  among  21,000  acci- 
dent cases  in  the  Private  Railways  Employers'  Association. 

3.  Only  12  instances  of  accident  neurosis  among  19,800  acci- 
dent cases  in  Section  3  of  the  Chemical  Industry. 

4.  No  instance  of  accident  neurosis  in  from  "6,000-7,000" 
accident  cases  of  the  North-West  Iron  and  Steel  Employers'  As- 
sociation. 

5.  Only    14   instances   of   accident   neurosis   among   about 
16,000  accident  cases  in  the  Warehousing  Employers'  Associa- 
tion. 

In  1906,  Dr.  L.  Merzbacher  published(4)  "Some  Statistical 
Observations  concerning  Accident  Neuroses,"  wherein  the  follow- 
ing conclusion  was  set  out: 

Only  13  instances  of  accident  neurosis  among  85,000  accident 
cases  in  the  Iron  and  Steel  Employers'  Association. 

Finally,  in  1912,  Dr.  Hugo  Stursberg  stated  that  only  24  in- 
stances of  accident  neurosis  were  to  be  found  among  14,529 
accident  cases  in  the  Rhenish-Westphalian  Building  Employers' 
Association.  (5) 

Attention  has  already  been  called  by  physicians  to  a  defect 
in  the  manner  of  obtaining  these  statistics.  The  conception  of 
what  constitutes  an  accident  neurosis  has  been  drawn  along  very 
narrow  lines  so  that  the  commonest  forms  are  just  those  which  are 
disregarded.  However,  before  I  take  up  this  point,  I  would  like 
to  analyze  the  fundamental  suppositions  on  which  these  statistics 
are  based  and  the  reliability  of  the  methods  resorted  to. 

Merzbacher's  system  was  the  following.  He  was  given  the 
cards  relating  to  the  accidents  that  had  occurred  from  1886  to 
1898,  in  Section  4  of  the  Iron  and  Steel  Employers'  Association 
(with  headquarters  at  Mannheim).  There  were  1,370  cards  in  all. 


O)     Sachs:    Die  Unfallneurose,  p.  41. 

(2)  Aerztl.  Sachverst:  Ztg.  for  1904,  p.  257  et  seq. 

(3)  Aerztl.  Sachverst:  Ztg.  for  1910,  p.  450  et  seq. 

(4)  Zentralbl.  f.  Nervenheilk.  u.  Psych.  1906,  p.  905  et  seq. 

(5)  Schultze    tmd    Stursberg,    "Erfahrungen    uber    Neurosen    nach 
Unfallen,"  at  p.  4. 

57 


The  material  therein  contained,  which  was  gathered  by  laymen 
and  stated  in  brief  form  in  accordance  with  the  official  require- 
ments, consisted  of  the  usual  notices  concerning  the  individuals 
affected,  the  kind  of  accident  incurred,  the  nature  of  the  injury, 
the  amount  of  the  pension  granted  and  the  length  of  time  the 
treatment  lasted. 

As  he  himself  states,  Merzbacher  then  determined  "by  a  quick 
glance  through  the  record  cards"  the  number  of  cases  which  he 
thought  ought  to  be  taken  into  account.  The  examination  of  the 
material,  that  is,  the  selection  of  the  cases  of  interest,  took  only 
a  few  hours. 

In  this  "quick  glance  through  the  record  cards,"  he  relied  en- 
tirely on  "experience"  for  his  standard  of  measurement. 

"By  a  little  experience,  which  one  is  able  to  acquire  in  a  short 
time,  it  becomes  possible  to  draw  conclusions  from  the  degree 
of  injury  suffered  as  to  the  amount  of  the  pension  which  may  be 
expected.  Thus  it  is  soon  learned  how  high  is  usually  the  pension 
of  a  man  who  has  lost  either  a  hand,  an  arm  or  an  eye  through  an 
accident.  In  these  cases,  one  encounters  figures  which  are  always 
repeating  themselves.  The  amount  of  the^pension,  as  expressed  in 
percentages,  is  the  same  in  individual  cases,  and  it  remains  year  in 
and  year  out  the  same  in  the  examples  we  have  cited,  that  is,  in 
cases  of  the  loss  of  a  limb  or  of  an  organ  of  the  body.  A  gradual 
decrease  in  the  amount  of  the  pension  in  certain  traumas,  which 
is  to  be  regarded  as  something  quite  natural  and  lawful,  is  ground 
for  our  setting  the  cases  to  one  side  as  no  longer  worthy  of  re- 
mark. A  disparity  between  the  degree  of  injury  received  and  the 
amount  of  pension  granted,  a  steady  increase  in  an  originally 
small  pension,  pensions  for  full  disability  after  unimportant  in- 
juries and  occurrences  of  a  similar  nature  will  at  once  attract  our 
attention,  indicating  that  some  complication  has  arisen  and  will 
make  the  case  seem  of  importance  for  the  purposes  of  our 
inquiry." 

If  one  stops  to  consider  that  a  branch  of  disease  is  here  in- 
volved about  the  nature  of  which  the  greatest  uncertainty  pre- 
vails among  doctors,  one  cannot  help  being  astonished  that  simply 
"by  a  hasty  glance  through  the  record  cards"  (which  have  been 
prepared  by  laymen)  an  "accurate  determination  of  facts"  should 
have  been  arrived  at,  which,  in  actual  practice,  in  spite  of  the 
most  careful  examination  and  observation  of  patients  can  only 
rarely  be  established  with  absolute  certainty^1) 

Even  more  flimsily  put  together  are  the  "statistics"  of  Biss, 
who  has  expressed  himself  obscurely  concerning  his  methods. 
Manifestly  he  did  not  himself  look  over  the  greater  part  of  the 
record  cards,  but  left  this  to  the  officials  of  the  employers'  asso- 


C1)     Concerning  the  uncertainty  which  prevails  solely  in  the  domain 
of  accident  neuroses,  see  the  next  following  page  but  one. 


ciation,  that  is,  to  laymen^1)  Finally,  Stursberg  confined  him- 
self to  the  remark  that  "he  had  succeeded  in  having  the  papers 
examined  of  1,241  of  those  injured  who  were  still  drawing  their 
pensions  in  1906."  Accordingly  the  methods  followed  in  these 
statistical  examinations  have  been  of  such  uncertain  value,  that, 
from  a  statistical  standpoint  alone,  the  results  of  these  tabulations 
can  hardly  be  accepted  as  controlling. 

But  in  addition  to  this,  it  appears  that,  in  the  judgment  of 
physicians,  the  method  of  interrogation  followed  was  faulty  and 
bound  to  give  erroneous  results.  On  this  point,  Dr.  Alfred  Jacoby 
writes:(2) 

"In  considering  only  cases  arising  after  severe  injuries  or 
after  severe  physical  shock,  Biss  has  adopted  a  very  narrow 
construction  of  the  expression  accident  neurosis.  Just  those  neu- 
roses which  gradually  develop  and  are  based  on  imaginary  no- 
tions, affections  and  suggested  ideas,  seem  to  be  the  most  fre- 
quent and  constitute  the  kind  which,  comparatively  speaking,  can 
be  most  easily  prevented." 

Dr.  Leopold  Laquer  writes  :(3) 

"In  all  these  statistics  (of  Biss  and  Merzbacher),  which  ap- 
pear to  operate  against  Hoche's  point  of  view,  the  often  repeated 
and  characteristic  disease  form  of  an  accident  neurosis  is  meant, 
or  in  other  words,  the  universally  psychologically  caused  psycho- 
neurosis  with  its  complexity  of  symptoms,  while  the  thousand 
varieties  of  local  nervous  symptoms  which,  Strumpell  first  desired 
to  have  termed  "local  traumatic  neurosis,"  are  not  included  in 
these  figures.  The  localized  morbid  sensitiveness  and  state  of 
weakness,  which  delay  the  recovery  of  accident  patients — even  in 
the  case  of  slight  distortions — for  days,  indeed  for  years,  are  suffi- 


0)  Thus  Biss  wrote  in  1904:  "I  am  informed  by  the  Private  Rail- 
ways Employers'  Association  that  among  the  21,783  accidents  which  were 
reported  between  the  years  1889  to  1903,  about  1,600  gave  rise  to  the 
payment  of  indemnities.  Among  these  last,  7  cases  had  been  discovered 
in  which  relatively  unimportant  injuries,  which  specifically  had  passed  off 
without  any  severe  bodily  shock,  had  caused  nervous  disturbances  which 
were  still  existent  and  which  the  physicians  termed  functional  dis- 
turbances." 

In  1910,  Biss  wrote :  "Section  3  of  the  Employers'  Association  for  the 
Chemical  Industry  was  able  to  put  at  my  disposal  only  12  of  such  cases 
out  of  2,670  indemnified  accidents."  I  believe  that  I  can  conclude  only 
that  Biss  left  the  examination  of  these  cards  to  the  officials  of  the  em- 
ployers' association  not  only  because  of  the  sentence  just  quoted,  but  also 
because  in  another  instance,  in  the  case  of  Section  4  of  the  North- West 
Iron  and  Steel  Employers'  Association,  he  expressly  mentions  that  "he 
had  been  able,  with  the  kind  assistance  of  the  manager,  himself  to  look 
through  all  those  reports,  which  seemed  to  come  into  question  accord- 
ing to  the  synopsis  entered  in  the  index  book."  As  he  especially  em- 
phasizes, in  only  one  instance  (in  the  case  of  Section  4  of  the  Ware- 
housemen's Employers'  Association)  Biss  "personally  examined  the  en- 
tire set  of  reports,  about  2,700  in  number,  relating  to  still  pending  cases." 

(2)  Jacoby,  cited  elsewhere,  at  p.  366. 

(3)  Die  Heilbarkeit  nervoser  Unfallfolgen,  Halle,  1912,  p.  13. 

59 


ciently  well  known  to  all  surgeons  and  indeed  to  every  sickness 
society  physician." 

After  these  not  very  encouraging  attempts  the  proposal  was 
made  to  have  made  an  examination  according  to  a  uniform  sys- 
tem, and  covering  a  period  of  from  10  to  20  years,  of  the  re- 
ports of  cases  of  several  of  the  larger  employers'  associations, 
with  branches  all  over  Germany,  in  order  to  obtain  reliable  data 
relative  to  the  exact  frequency  and  the  increase  and  decrease  of 
cases  of  neurosis.  Such  repeated  tabulations  were  demanded  as 
"the  indispensable  prerequisites  to  the  introduction  of  preventive 
measures  and  to  a  test  of  the  efficacy."  (J) 

However  valuable  a  really  reliable  determination  of  the  above 
facts  would  be,  its  realization  appears  improbable.  At  the  very 
outset,  the  point  at  which  such  tabulations  should  be  begun  is 
quite  uncertain;  for  the  medical  authorities  are  far  from  being 
of  uniform  opinion  concerning  the  nature  of  accident  neurosis. 

One  may  still  regard  a  traumatic  neurosis  to  be  a  peculiar 
nervous  disease  of  a  certain  category,  while  others  assume  some- 
times hysterical  and  sometimes  neurasthenic  symptoms,  to  be 
ascribed  either  to  the  accident  or  to  the  fact  of  being  insured.  It 
is  possible  to  judge  from  Biss'  statistics  what  an  effect  these  dif- 
ferences of  opinion  would  have  on  the  statistical  tabulations.  (2) 

In  daily  practice  this  state  of  uncertainty  is  actually  multiplied, 
because  usually  several  causes  work  together  in  producing  the 
disease. (3)  How  uncertain  is  medical  practice  on  this  particular 
subject  of  accident  neurosis  is  strongly  expressed  in  a  statement 
of  Laquer,  the  Frankfort  physician  for  nervous  ailments:  "The 
same  obligatory  course  is  pursued  in  the  determination  of  a  pen- 
sion both  in  the  case  of  simple  and  of  complex  accident  neu- 
rosis. An  old  judge  of  cases  of  accident  neurosis  once  jokingly 
said:  'In  the  even  years,  the  pensions  are  increased  and  in  the 
uneven  years  they  are  decreased.'  Medical  examiner  and  judge 
are  changed  and  with  them  the  opinion  as  to  the  cause  of  the 
invalidity  incurred,  especially  as  the  number  of  workmen  and 
above  all  that  of  unskilled  workmen  who  have  a  fixed  abode 
varies  frequently." (4)  The  opinions  of  physicians  in  active  prac- 


0)     Jacoby,  before  cited,  at  p.  367. 

(2)  See  Laquer's  criticism  above. 

(3)  In  this  connection,  the  following  remarks  of  Ernst  Schultze  may 
be  of  interest,  because  they  show  how  far  some  physicians  go  in  their 
efforts  to  arrive  at  "accurate"  results.     ("Der  Kampf  urn  die  Rente  und 
der  Selbst-mord  in  der  Rechtsprechung  des  Reichsversicherungsamtes," 
Halle,  1910,  p.  29  et  seq)  :    "But  it  is  not  possible  for  me  to  imagine  how 
then  one  can  indicate  how  far  the  loss  in  earning  capacity  caused  by  the 
neurosis  is  to  be  ascribed  to  the  accident  and  how  far  the  struggle  to 
obtain  a  pension  is  to  be  held  responsible  therefor.  .  .  .  And  my  skepticism 
has  not  vanished  since  in  some  medical  reports  I  have  seen  this  influence 
measured  in  absolutely  exact  figures.     One  ought  not  to  forget  that  in 
many  cases  of  traumatic  neurosis  the  estimation  of  the  degree  of  working 
capacity  is  more  or  less  a  matter  of  individual  sentiment." 

(4)  Laquer,  before  cited,  p.  111. 

60 


tice  are  so  diametrically  opposed  to  one  another  that  Ernst 
Schultze  was  able  to  write:  "Recently  I  have  been  repeatedly 
warned  against  sending  those  injured  in  accidents  to  a  neurol- 
ogist or  to  a  psychologist  to  be  reported  upon.  As  I  discovered  in 
looking  over  the  medical  documents,  an  expert  warned  not  long 
ago  against  sending  a  sick  patient  who  had  met  with  a  severe  rail- 
way accident  to  a  neurologist  for  examination,  as  in  that  event 
he  would  develop  a  case  of  traumatic  neurosis."  (*) 

Therefore  some  physicians  have  long  pleaded  to  have  the  con- 
ception of  traumatic  neurosis  eliminated  from  medical  science, 
inasmuch  as  the  disease  pictured  by  Oppenheim  did  not  exist  in 
a  universal  form.  Rather  many  forms  of  disease  were  involved, 
so  that  no  one  could  determine  with  certainty  where  the  line  was 
to  be  drawn  between  the  immediate  consequences  of  an  accident, 
the  effects  of  the  "struggle  for  a  pension,"  hysteria  and 
neurasthenia. 

Finally,  if  it  be  desired  to  observe  the  undesirable  conse- 
quences of  working-men's  insurance  and  the  struggle  for  a  pen- 
sion in  their  complete  extent,  one  should  not  overlook  the  fact 
that  statistics  of  "accident  neuroses"  cover  only  a  portion  of  the 
whole  field  of  pension  mania.  (2)  What  the  surgeons  have  estab- 
lished concerning  a  diminution  in  the  chances  of  recovery  is  only 
in  rare  cases  to  be  included  under  the  designation  of  "neu- 
rosis.'^3) The  phenomena  of  sickness  and  invalidity  insurance, 
which  are  of  great  moment  in  daily  practice  are  likewise  to  be 
placed  in  a  category  by  themselves. 

Especially  is  this  true  of  the  burdening  of  sickness  societies 
and  insurance  institutions  with  those  suffering  from  stomach 
and  intestinal  disorders.  Perutz,  who  made  an  investigation  con- 
cerning the  extent  to  which  the  sickness  societies  were  burdened 
with  digestive  troubles  and  those  relating  to  the  non-assimilation 
of  food,  thus  called  attention  to  the  fact  that  the  percentage  of 
those  suffering  from  stomach  troubles  is  strikingly  high  in  the 
building  trade.  As  to  this  he  remarks:  "But  I  think  that  we 
would  do  wrong  if  we  assumed  this  to  represent  in  any  way  an 
occupational  disease  or  as  being  due  to  the  misuse  of  stimulants. 
It  is  more  probable  to  assume  that  unemployment,  which  is  so 
prevalent  in  the  building  trades  in  winter,  leads  to  an  increased 
inclination  on  the  part  of  those  insured  to  report  themselves  as 
disabled  on  account  of  slight  ailments." (4) 

Schallmayer  also  calls  attention  to  the  fact  that  sickness  in- 


(1)  Ernst  Schultze,  ante,  p.  42. 

(2)  In  his  address  "Licht  und  Schatten    beider   Deutschen   Arbeiter 
Versicherung,"    President   Katifmann   of   the    Imperial   Insurance   Office 
makes  the  mistake  of  not  taking  this  fact  into  consideration  and  thus 
arrives  at  erroneous  conclusions. 

(s)     Concerning  the  surgeon's  experience,  see  ante. 
(*')     Perutz,   cited   ante.     Zeitschrift   fur    Soziale   Medizin,   etc.,   Vol. 
IV,  Book  1,  p.  104. 

6l 


surance  "is  frequently  made  use  of  as  a  way  of  insurance  against 
unemployment."  ( 1 ) 

If  statistical  data  is  to  be  taken  into  consideration  at  all,  one 
should  not  forget  that  almost  every  disease  can  be  influenced  by 
the  attitude  of  the  patient.  Just  as  soon  as  the  struggle  for  a 
pension  comes  into  play,  the  sick  man  is  obliged  "to  nourish  all  his 
symptoms  for  as  long  a  time  and  in  as  acute  a  form  as  possible." 
If  his  condition  is  adjudged  to  be  favorable,  he  regards  such 
report  with  malignity  and  distrust.  Thus  is  the  confidential  re- 
lation between  himself  and  his  physician  completely  destroyed. (2) 

Thus  also  is  the  ground  prepared  for  what  has  been  termed 
"psychical  infection."  From  our  studies  concerning  the  psychol- 
ogy of  the  masses  we  know  that  the  spread  of  unsound  ideas 
in  epidemic  fashion  is  helped  especially  by  the  loss  of  the  in- 
dividual's sense  of  responsibility^3)  And  this  is  what  has  oc- 
curred in  a  very  marked  degree  since  the  introduction  of  social 
insurance.  "The  conviction  that,  as  a  matter  of  right,  every  acci- 
dent entitles  the  injured  party,  to  the  highest  possible  compensa- 
tion has  come  to  be  a  dogma  among  the  people  and  the  common 
property  of  the  masses." (4)  "The  pension  mania,  which  the  law 
has  called  into  existence,  has  taken  such  deep  root  in  work- 
ingmen's  circles  .  .  .  The  pursuit  of  a  pension  is  regarded 
as  something  eminently  lawful" (5)  ;  and  as  a  workingman's  as- 
sociates learn  immediately  all  the  particulars  of  a  case  "which 
has  had  a  successful  outcome,"  conditions  are  thus  fufilled  for 
inciting  wide  circles  to  imitation. 

At  this  point,  suggestion  comes  promptly  into  play  and  rein- 
forces the  "mental  infection"  to  such  a  degree  that  the  spreading 
of  the  pension  mania  has  been  compared  to  the  epidemics  of  the 
mind,  such  as  were  known  some  centuries  ago  and  referred  to 
in  the  terms  flagellants  and  trembleurs.(6)  At  the  same  time, 
the  distortion  of  elementary  ideas  has  gone  so  far  that  the  draw- 
ing of  a  pension  is  regarded  as  an  honor. (7) 

(*)  Schallmayer :  Was  ist  von  unserem  sozialen  Versicherungswesen 
fiir  die  Erbqualitaten  der  Bevolkerung  zu  erwarten?  Zeitschrift  fur 
soziale  Medizin,  etc.,  Vol  III,  Book  1,  p.  60. 

(2)  Dr.  F.  Ritter.     Oldenburg.     Nachteile  der  sozialen  Gesetze.     Die 
Grenzboten,  69th  year,  No.  52. 

(3)  Weygandt:    Beitrag  ziir  Lehre  von  den  psychischen  Epidemien. 
Halle,  1905.    Le  Bon :    Psychologic  der  Massen.    Leipzig,  1908.     Gudden. 
Ueber  Massen.  suggestion  und  psychische  Massenepidemien.   Munich,  1908. 

(4)  Laquer:    Die  Heilbarkeit  nervoser  Unfallfolgen,  at  p.  99. 

(5)  Ernst  Schultze:    Kampf  nm  die  Rente,  at  p.  36. 

(6)  On  this  point,  compare  Kiihne,  Ueber  die  in  der  Versicherungsge- 
setzgebung  wirksamen   ungiinstigen   seelischen   Einflusse.     Monatsschrift 
fiir  Unfallheilkunde,  etc.,  for  1910,  at  p.  39  et  seq.  — Rigler  and  others  in 
the    Zeitschrift    fiir    Versicherungsmedizin    for    1909,    at    p.    177    et    seq. 
— Hoche:     Notwendige   Reformen   der   Unfallversicherungsgesetzgebung, 
1907.     — Verhandlungen  auf  der  Wandersammlung  suddeutscher  Neuro- 
logen,  1907.  —Especially  also  Sachs,  Unfallneourose,  1909. 

(7)  Weygandt  stated  at  the  Wanderversammlung  of  the  Southwest 
German  Neurologists  and  Alienists  (1907)  that  some  of  the  insured  had 
even  had  printed  visiting  cards  bearing  the  words  "recipient  of  a  pension." 

62 


'Thus  it  has  happened,"  writes  Sachs,  "that  the  disease,  which 
the  physician  deemed  originally  as  something  new,  peculiar  and 
unusual,  has  become  more  and  more  widespread  and  has  today  be- 
come a  veritable  epidemic."  (*) 

For  this  reason,  Quincke,  who  is  accustomed  to  ex- 
press himself  only  after  carefully  weighing  the  pros  and 
cons,  determined  to  utter  a  general  warning  in  a  striking 
way.  He  contrasted  the  system  of  universal  military  serv- 
ice with  that  of  workingmen's  insurance,  and  added:  "If 
the  defence  of  the  fatherland  was  the  immediate  cause  for 
and  the  ultimate  object  sought  in  the  introduction  of  universal 
military  service,  it  nevertheless  has  an  educational  influence  on 
the  individual,  and  especially  because  it  teaches  him  to  disregard 
discomforts,  to  sink  his  own  personality  and,  as  a  member  of  a 
great  entity,  to  seek  the  attainment  of  a  common  object.  It 
diminishes  egotism;  while  the  system  of  accident  insurance  calls 
it  forth,  through  the  anxiety  developed  about  one's  beloved  'ego.' 
The  system  of  universal  military  service  lays  stress  on  the  per- 
formance of  a  duty,  that  of  accident  insurance  on  the  right  of  the 
individual.  Many  decades  have  been  required  in  order  to  have 
the  full  educational  effect  of  the  former  felt  on  the  national  char- 
acter; but  the  depraving  influence  of  the  accident  insurance  law 
is  already  noticeable,  and  will  become  more  and  more  visible 
as  the  years  go  on."(2)  And  when  Hoche,  the  celebrated  psychol- 
ogist, became  rector  of  the  university  at  Freiburg  im  Breisgau, 
and,  at  the  beginning  of  his  term  of  office,  delivered  an  address  on 
culture  and  the  diseases  of  the  mind,  he  expressed  himself  thus : 
"Thirty  years  ago  it  (a)  was  still  an  unknown  term,  today  it  is  a 
disease  which,  as  a  cancer  in  the  organism  of  our  whole  working 
population,  is  rightly  a  cause  of  grave  anxiety.  This  people's 
plague  not  only  arose  after  the  enactment  of  accident  insurance 
legislation,  but  is  directly  dependent  on  it.  There  is  no  doubt  that 
the  law  has  produced  the  disease.  No  one  was  able  to  foresee 
it.  One  is  reminded  of  Bismarck's  comparison  of  the  state  to  a 
living  organism  with  which  one  should  experiment  carefully."(3) 


CHAPTER  V. 

THE  DIFFICULTY  OF  SECURING  REFORM  LEGISLATION. 

Representative  of  the  Centre  Party:  "Gentlemen,  it  is  also 
interesting  to  observe  that  the  fire  of  the  Social  Democrats  is 
always  exclusively  directed  at  the  Centre  .  .  .  Gentlemen, 
the  plot  behind  this  is  known  and  also  the  object  of  this  manoeuvre. 

0)     Sachs,  cited  ante,  at  p.  42. 

(2)  Quincke.     Der  Einfluss  der  Sozialen  Gesetze  auf  den  charakter. 
Schlesische  Zeitung,  1905. 

(3)  Hoche.     Geisteskrankheit  und  Kulture,  at  p.  25. 
(a)     Referring  to  pension  mania.    Translator's  Note. 

63 


The  gentlemen  opposite  have  systematically  tried  to  discredit  the 
Centre  Party  among  such  of  the  workmen  as  are  our  supporters." 
Social  Democratic  representative:  "But  you,  gentlemen  of 
the  Centre,  wish  to  appear  outside  as  the  party  which  is  friendly 
disposed  towards  the  Workingman.  You,  therefore,  make  a  great 
hullabaloo  over  your  so-called  friendly  attitude  towards  the  work- 
ingman  .  .  ."  (from  the  Reichstag  debate  of  March  21, 
1912,  on  the  budget  of  the  Imperial  Insurance  Office.) 


The  difficulty  of  securing  reform  legislation  is  to  be  found  in 
the'  fact  that  all  the  great  parties  in  the  Reichstag  anxiously  avoid 
doing  anything  which  might  arouse  the  working  masses  against 
them.  As  everyone  knows,  the  "labor  vote"  is  of  decisive  im- 
portance not  only  for  the  Social  Democrats,  but  the  Centre  group 
also  is  in  part  a  workingmian's  party.  Similarly,  the  Progressive 
People's  Party  has  to  count  on  support  from  the  labor  element  at 
election  time ;  and  the  leader  of  the  National  Liberals  gained  the 
Reichstag  with  the  help  of  the  "labor  vote." 

As  soon  as  a  member  proposes  some  reform,  which  affects 
workingmen's  insurance  matters,  he  runs  the  risk  of  furnishing 
the  most  effective  campaign  material  against  himself.  The  very 
day  thereafter  the  opposition  local  press  is  filled  with  bitter 
comment,  the  member's  words  are  misquoted  and  in  the  electoral 
campaign,  the  "material"  is  used  against  him  anew.  It  is,  therefore, 
easy  to  understand  why  reform  measures  do  not  readily  obtain  the 
support  of  the  great  parties  in  the  Reichstag.  Certainly  no  one 
will  deny  that  abuses  do  exist;  but  there  is  a  shibboleth  handy, 
namely,  "simplification  of  procedure,"  the  purpose  of  which  is  to 
manifest  a  favorable  attitude  towards  reform  without  raising 
any  implication  of  unfriendliness  to  labor. 

THE  SIMPLIFICATION  OF  PROCEDURE. 

Irrespective  of  party,  no  one  could  overlook  the  fact  that 
the  highest  court  in  workingmen's  insurance  matters  is  over- 
burdened, and  consequently  that  decisions  in  appeal  cases  were  un- 
duly delayed.  Thus,  for  example,  while  originally  over  63%  of  all 
appeals  were  decided  in  the  same  year  in  which  they  were  taken, 
this  percentage  has  diminished  from  year  to  year  so  that  in  1909 
only  4:1%  of  the  appeals  taken  were  decided  in  the  same  year, 
in  1910  only  32%  and  in  1911  only  22%. (*) 

Moreover,  it  had  occurred  that,  in  the  opinion  of  many  secre- 
taries of  labor  organizations,  the  interpretation  of  the  law  by  the 
highest  court  was  "more  unfavorable"  to  the  workingmen  than 
that  in  vogue  in  the  courts  of  next  lower  jurisdiction  (the  arbi- 
tration courts). 

Under  these  circumstances,  the  great  parties  were  able  to 
agree  that  appeals  (and  revisions  respectively)  should  be  done 


C1)     Amtliche  Nachrichten  des  Reichsversicherungsamtes,  27th  year, 
No.  2,  p.  298,  and  28th  year,  No.  2,  p.  280. 

64 


away  with  in  many  cases  in  order  that  the  Imperial  Insurance 
Office  might  be  freed  from  a  considerable  number  of  the  present 
appeals^1) 

If  now  in  the  course  of  the  next  few  years  a  rapid  decrease 
should  be  noted  in  the  number  of  appeals  and  revisions,  one 
should  not  give  one's  self  up  to  the  delusion  that  the  mania  for 
litigation  has  been  done  away  with.  The  changed  procedure 
affords  plenty  of  scope  to  the  mania  for  litigation.  Instead  of 
the  three  stages  previously  existing — judgment,  appeal  and  re- 
course— the  three  new  stages  of  judgment,  protest  and  appeal 
are  to  take  their  place  and,  for  certain  cases,  recourse  constitutes 
a  fourth  stage.  Taking  it  all  in  all,  one  should  not  expect  too 
much  from  the  efforts  of  the  Reichstag  parties  to  simplify  the 
methods  of  procedure.  Despite  the  long  drawn  out,  painstaking 
labors  of  experts, (2)  a  want  of  precision  is  still  to  be  noticed 
in  many  places,  due  to  the  everlasting  anxiety  about  the  votes  of 
the  labor  element.  Consequently  this  legislation,  which  is  in- 
tended to  simplify  methods  of  procedure,  suffers  from  an  un- 
certain backward  and  forward  sort  of  revision. (3) 


(!)  §1696  of  the  Imperial  Insurance  Code  provides:  "In  the  case  of 
claims  for  compensation  under  invalidity  insurance  and  survivors'  insur- 
ance a  revision  is  excluded  if  questions  are  involved  pertaining  to 

1.  Amount,  time  of  beginning  and  time  of  cessation  of  a  pension. 

2.  Lump  sum  payments. 

3.  Widows'  pensions. 

4.  Orphans'  dowry. 

5.  Judicial  costs." 

§1697:  "A  revision  can  only  be  taken  on  the  ground  that 

1.    The  judgement  excepted  to  is  based  on  the  non-application  or  on 

the  false  interpretation  of  the  existing  law  or  on  a  disregard  of  the  plainly 

expressed  contents  of  the  pleadings. 

§1700.     "A  recourse    (appeal)   is  excluded  if  questions  are  involved 

pertaining  to 

1.  Sickness  treatment  or  treatment  at  home. 

2.  Pensions  for  an  occupational  disability,  which,  at  the  time  of  the 
decision  of  the  court  of  recourse,  is  incontestable  or,  after  judicial  deter- 
mination, has  disappeared. 

3.  Apportionment  of  pensions,  which  in  the  case  of  permanent  dis- 
ability are  to  be  granted  for  limited  and  already  expired  periods. 

4.  Treatment  in  sanatoriums. 

5.  Pensions  of  heirs. 

6.  Funeral  expense  money. 

7.  Provisional  pensions. 

8.  New  determination  of  permanent  pensions  on  account  of  change  of 
condition. 

9.  Lump  sum  payments. 

10.  Judicial  costs." 

(2)  Graf  von  Westarp,  member  of  the  Reichstag,  said:   "We  have 
devoted  ourselves  to  this  subject  from  April,  1910,  until  June,  1911." 

(3)  Thus  for  example,  in  a  desire  to  meet  the  wishes  of  the  working- 
men,  the  Reichstag  in  1900  abolished  in  many  cases  the  preliminary  appeal 
to  the  employers'  association   (§88,  paragraph  3,  gave  to  the  arbitration 
courts  the  right  to  decide  concerning  "the  otherwise  determination"  of 
pensions  which  had  been  paid  for  a  period  of  five  years).    In  consequence 
of  this  change,  excessive  demands  were  made  on  the  time  of  the  highest 
court  and  a  condition  of  affairs  brought  about  which  in  turn  it  is  sought 

65 


THE  RESTORATIVE  TREATMENT  DURING  THE  WAITING  PERIOD. 

To  the  elementary  methods,  as  I  might  term  them,  which  are 
resorted  to  for  the  attainment  of  a  pension  there  are  joined  the 
artful  attempts  to  play  one  insurance  branch  against  the  other. 
No  one  can  help  being  surprised  at  the  circumspection  and  dex- 
terity displayed  in  espying  the  places  where  proceedings  can  be 
successfully  instituted. 

This  is  especially  true  of  the  points  where  sickness  insurance 
and  accident  insurance  rub  shoulders.  Two  fields  of  insurance 
work  are  concerned,  which  are  governed  by  different  financial 
and  technical  rules  and  yet  in  their  actual  workings  come  into 
close  contact.  For  it  is  often  uncertain  whether  the  injury  a 
workman  has  undergone  was  caused  by  "an  accident  in  the  course 
of  his  employment"  or  whether  it  made  its  appearance  as  the 
result  of  a  "disease."  (*) 

In  practice,  however,  one  cannot  wait  to  determine  whether 
the  sickness  society  or  the  accident  insurance  branch  is  to  act. 
The  statute  therefore  provides  that  the  sickness  society  shall  at- 
tend to  the  preliminary  treatment  while  the  employers'  associa- 
tion shall  await  the  outcome.  The  law  provides  for  a  waiting 
period  of  thirteen  weeks. (2)  During  this  waiting  period,  the 
sickness  society  for  the  purpose  of  reducing  its  financial  burdens, 
is  zealously  engaged  in  trying  to  prove  that  the  illness  resulted 
from  an  accident  incurred  during  working  hours.  On  the  other 
hand,  as  soon  as  the  fact  of  an  accident  having  occurred  is  estab- 
lished, the  sickness  society  is  not  interested  in  watching  the 
further  progress  of  the  case  closely.  This  period  of  betwixt 
and  between  can  be  utilized  by  all  those  who  consciously  or  un- 
sciously  are  inclined  to  derive  a  pecuniary  profit  from  the  in- 
jury. For  when  the  employers'  association  takes  hold  a  full 
quarter  of  a  year  after  an  accident,  it  can  seldom  be  determined 
with  certainty  whether  certain  nervous  troubles  existed  before 
the  accident  or  not.  The  employers'  association  also  is  no  longer 
in  a  position  to  make  use  of  its  appliances,  which  make  it  difficult 


(x)  How  very  uncertain  the  courts  are  in  determining  whether  an 
accident  or  the  result  of  an  illness  is  in  question  can  be  seen  by  reading  the 
decisions  which  Breithaupt  has  collected  in  his  excellent  digest:  Die 
Rechtsprechung  des  Reichsversicherungsamtes,  Berlin,  1912,  p.  16. 

(2)  For  the  peculiar  way  in  which  the  waiting  period  arose,  see  Thiem : 
Handbuch  der  Unfallerkrankungen,  Vol.  1,  p.  16  et  seq. 

to  remedy  by  again  making  the  employers'  association  the  first  court  of 
resort. 

A  similar  vacillation  appears  in  the  regulation  of  the  initial  proceedings. 
Thus  through  §70  of  the  Industrial  Accident  Insurance  Law  (supplemental 
law  of  1900)  the  workman  was  allowed  to  participate  closely  in  the  initial 
proceedings  for  the  determination  of  the  amount  of  a  pension  and  a  dimi- 
nution in  the  number  of  appeals  was  the  result.  On  the  other  hand,  the 
Imperial  Insurance  Code  does  away  with  this  arrangement  in  order  to 
simplify  the  procedure. 

66 


for  the  injured  by  a  system  of  "passive  resistance"  to  preserve 
stiffness  of  the  joints,  etc^1) 

For  this  reason,  since  1892  the  employers'  associations  have 
been  permitted  to  take  over  the  treatment  of  the  injured  even 
during  the  waiting  period. (2)  The  Imperial  Insurance  Office 
not  only  tries  by  circulars  to  induce  the  employers'  associations 
to  make  as  extended  a  use  of  this  right  as  possible,  but  has  also 
worked  out  a  number  of  instructions  in  order  to  cause  such  asso- 
ciations to  resort  to  a  comprehensive  and  systematic  method  of 
treatment  during  the  waiting  period.  (3) 

Nevertheless,  the  sickness  societies  raised  objections;  and  the 
often  very  complicated  proceedings  required  deterred  many  of 
the  employers'  associations  from  taking  any  action  before  the 
end  of  the  13th  week.(4)  The  Imperial  Insurance  Code  now 
makes  it  easier  for  them  to  take  hold  at  an  earlier  period.  It  per- 
mits the  employers'  associations  to  conclude  conventions  with  the 
sickness  societies  whereunder  the  treatment  of  every  person  in- 
jured can  be  immediately  undertaken  by  the  employers'  associa- 
tion. It  obligates  the  sickness  societies  to  make  more  prompt 
reports  of  accidents  and  allows  the  employers'  associations  to 
have  each  victim  examined  and  to  obtain  information  concerning 
his  condition  from  the  sickness  societies. 

Whether  conditions  will  be  appreciably  improved  thereby  is 
indeed  doubtful,  for  the  gap  in  the  system  remains  and  makes  it 
easy  for  the  insured  to  play  the  sickness  societies  against  the 
employers'  associations.  The  physicians  and  the  more  exper- 
ienced officials  are  therefore  urging  the  entire  abolition  of  the 
waiting  period  for  the  employers'  associations.  (8) 


(*)  The  Silesian  Iron  and  Steel  Employers'  Association  was  the 
first  to  have  those  injured  treated  in  a  medico-mechanical  way  during 
the  waiting  period,  although  the  sickness  societies  often  caused  con- 
siderable difficulties.  Experience  showed  that  in  the  case  of  arm  and  leg 
fractures  "the  end  of  the  second  or  beginning  of  the  third  week"  was 
the  very  latest  time  for  the  beginning  of  the  treatment.  In  case  of  broken 
fingers,  injuries  to  the  elbow  joint,  severed  sinews  or  nerves,  or  dis- 
locations, the  treatment  has  to  be  begun  earlier,  if  a  complete  restoration 
is  to  be  secured. 

(2)  §76c  of  the  supplemental  act  to  the  sickness  insurance  law. 

(3)  Amtliche  Nachrkhten  des  Reichsversicherungsamts  for  1911,  at 
p.  595. 

(4)  Thus,    for   example,   it   was   a  disputable   question   whether  the 
employers'  associations  had  the  right  to  have  the  injured  party  examined 
during  the  first  thirteen  weeks  after  the  occurrence  of  an  accident  without 
at  the  same  time  taking  over  the  entire  treatment. 

(B)  The  following  figures  (Amtliche  Nachrichten  des  Reichsver- 
sicherungsamtes  for  1912,  at  p.  271)  show  how  seldom  the  employers' 
associations  have  thus  far  made  use  of  the  right  to  take  over  the  restora- 
tive treatment  during  the  waiting  period. 

In  1906  only  1.96  per  cent,  of  reported  accidents  were  taken  over. 

In  1907  only  1.88  per  cent,  of  reported  accidents  were  taken  over. 

In  1908  only  2.07  per  cent,  of  reported  accidents  were  taken  over. 

In  1909  only  2.40  per  cent,  of  reported  accidents  were  taken  over. 

In  1910  only  2.63  per  cent,  of  reported  accidents  were  taken  over. 

6? 


THE  ABOLISHMENT  OF  APPEALS  FREE  OF  COST. 

If  the  reform  of  workingmen's  insurance  is  hindered  today 
because  of  electoral  campaign  tactics,  the  necessity  of  bringing 
about  more  efficacious  reforms  will  become  more  apparent  as  time 
goes  on.  Heretofore  the  "method  of  procedure"  in  working- 
men's  insurance  matters  furnished  the  politicians  material  enough 
for  resolutions  and  speeches.  The  subject  gave  opportunity  for 
censuring  the  bureaucratization  of  social  insurance,  of  offering 
to  the  workmen  a  more  rapid  attainment  of  pensions  and  of  parad- 
ing as  up-to-date,  well  informed  representatives  and  friends  of 
the  workingman. 

But  ultimately  this  vein  will  be  exhausted,  and  the  increas- 
ing abuses  will  compel  attention  in  sober  earnest  to  the  proposi- 
tions which  physicians  and  experienced  officials  have  been  recom- 
mending for  years  past. 

All  these  propositions  have  one  point  in  common — they  are 
annoying  to  the  insured.  They  are  additional  safeguards  by 
which  the  benefits  conferred  by  the  law  are  to  be  circumscribed. 

The  official  statistics  of  the  Imperial  Insurance  Office  show 
that  the  greater  part  of  the  appeals,  recourses  and  revisions  taken 
are  unfounded,  and  that  the  great  number  of  legal  remedies  that 
can  be  resorted  to,  leads  to  an  intolerable  overburdening  of  the 
courts  and  to  a  serious  delay  in  procedure. 

It  is  very  difficult  to  obtain  an  idea  of  the  prevailing  mania 

Bogatsch,  who  has  had  much  experience  in  this  matter  and  who  in 
1909  prepared  a  memorandum  thereon  for  the  Imperial  Insurance  Office, 
is  of  the  opinion  that  a  real  improvement  can  be  brought  about  only  if 
the  waiting  period  for  the  employers'  associations  be  entirely  done  away 
with.  "The  insured,"  he  writes,  "could  only  profit  thereby,  since  a  uni- 
form treatment  would  then  be  bestowed  on  them  from  the  beginning  and 
they  would  then  more  than  formerly  come  to  enjoy  the  advances  of 
the  last  two  decades  in  accident  surgery."  Monatsschr.  f.  Unfallheilk. 
1910,  No.  11  and  12,  p.  315. 

Also  at  the  third  International  Medical  Accident  Congress,  which  was 
held  from  the  6th  to  the  10th  of  August,  1910,  the  speakers— especially 
Lohmar,  of  Cologne,  and  Frank,  of  Berlin, — warmly  advocated  an  early 
taking  over  of  the  restorative  treatment. 

On  the  other  hand,  Mugdan  writes:  "As  is  well  known,  high  hopes, 
especially  in  official  circles,  are  based  on  the  taking  over  of  the  restorative 
treatment  by  the  employers'  associations.  Now  it  cannot  by  any  means  be 
denied  that  the  taking  over  of  the  restorative  treatment  by  the  employers' 
associations  during  the  time  of  the  waiting  period  can  be  of  great  ad- 
vantage for  them  and  for  the  injured  party  if  the  injury  requires  a  com- 
plicated course  of  or  an  expensive  treatment,  which  is  beyond  the  means 
of  many  of  the  sick  patients.  On  the  other  hand,  there  is  nothing  to  be 
gained  if  the  employers'  associations  indiscriminately  direct  the  treatment 
of  every  accident  case.  Not  all  injuries  by  any  means  heal  more  easily 
through  the  use  of  the  'intensive'  system  of  treatment.  Moreover  it 
happens  that  through  this  treatment  the  feeling  is  aroused  in  a  con- 
siderable number  of  the  insured  that  a  quicker  and  more  efficacious 
method  of  recovery  is  not  so  much  sought  as  a  reduction  in  the  pension 
rate."  "Einftihrung  in  die  Reichsversicherungsprdnung.  Addresses  held 
between  October  13th  and  30th,  1911,  in  the  seminary  for  social  medicine." 
Berlin,  Allgemeine  Medizinische  Verlagsanstalt,  1912,  at  p.  55. 

68 


for  litigation  simply  from  figures.  Nevertheless,  the  following 
facts  should  be  borne  in  mind: 

In  accident  insurance,  over  400,000  awards  are  rendered  year- 
ly from  which  the  following  disproportionate  number  of  lawsuits 
results:  In  1911  there  were  over  170,000  lawsuits  brought  (in 
accident  cases  alone ).(1)  In  a  considerable  number  of  cases  the 
contest  was  carried  on  through  all  the  courts.  In  industrial  acci- 
dent cases  recourse  was  had  to  the  Imperial  Insurance  Office  in 
30%  of  all  cases;  and  in  agricultural  accident  insurance  in  almost 
20%  of  all  cases.  (2)  Altogether  there  were  over  42,000  recourses 
pending  in  the  Imperial  Insurance  Office,  about  half  of  which 
were  left  over  from  the  previous  year.  Conditions  are  similar  in 
invalidity  insurance,  where  revision  was  demanded  in  25%  of 
all  awards. 

It  is  easy  to  see  that  a  majority  of  the  suits  in  question  are 
unjustified.  Of  the  recourses  taken  by  the  workingmen  in  acci- 
dent insurance  cases,  over  80%  were  denied,  and  almost  90% 
of  the  revisions  taken  by  the  workingmen  in  invalidity  insurance 
cases. (3)  As  has  already  been  stated,  the  innovation  in  the  Im- 
perial Insurance  Code  can  be  of  only  nominal  help  against  such  a 
readiness,  not  to  say  wantonness,  in  starting  suits.  In  reality, 
there  is  only  one  means  of  bringing  about  a  change,  namely,  to 
stop  the  allowance  of  appeals  and  recourse  proceedings  free  of 
charge.  Undoubtedly  it  will  be  objected  that  such  a  step  is  un- 
social. Nevertheless,  the  opinion  is  gaining  ground  that  one  does 
the  workingman  himself  a  poor  service  if  one  makes  it  easy  for 
him  to  start  litigation  in  insurance  matters.  In  the  course  of 
time,  the  first  indications  of  a  coming  change  of  methods  have 
become  noticeable.  (4)  Even  the  Social  Democratic  Party  gave 


(*)  The  number  "of  contested  cases  of  the  arbitration  courts  await- 
ing determination"  was  130,373  in  1911  and  the  number  "of  recourses 
awaiting  determination"  was  42,120.  Cf.  Amtliche  Nachrichten  des  Reichs- 
versicherungsamtes  for  1912  at  pp.  272  and  274. 

(2)  For  every  100  appealable  decisions  of  the  arbitration  courts  the 
number  of  recourses  taken  was  30.34  and  18.36  respectively. 

(3)  To  be  exact:    82.4%  of  recourses  and  88.49%  of  revisions. 

(4)  Thus  the  ordinance  of  November  22nd,  1900,  concerning  the  pro- 
cedure of  the  arbitration  courts  for  workingmen's  insurance,  provided  in 
§20,  Par.  3 :   "The  chairman  of  the  arbitration  board  can  impose  on  those 
immediately   concerned   such   of  the   costs   of  the   proceedings   as   have 
been  wantonly  incurred  or  caused  by  an  attitude  intended  to  deceive  or 
to  cause  delay." 

And  §21:  "Without  a  motion  being  required  therefor,  the  arbitration 
court,  at  the  time  of  the  decision  of  the  main  question  involved,  must 
look  into  the  matter  whether  and  to  what  extent  the  losing  party  has  to 
make  good  the  costs  incurred  by  the  opposing  party  in  the  proceeding 
before  the  arbitration  court." 

The  Imperial  Insurance  Code  now  contains  a  similar  provision.  In 
§1802:  "If  one  of  the  parties  interested  has  through  wanton  misbe- 
havior, by  improper  delay  or  through  misleading  statements,  caused 
costs  to  be  incurred  in  the  proceeding,  the  insurance  bodies  can  impose 
these  costs  on  him  either  wholly  or  in  part." 

69 


its  consent  to  costs  being  imposed  on  the  workingman  in  certain 
cases  (1),  and  the  Imperial  Insurance  Code  provides  that  the 
Insurance  Office  must  hear  the  testimony  of  a  physician  proposed 
by  the  workman  if  the  latter  "pays  the  costs  therefor  in  ad- 
vance." (2) 

Thus  the  old  principle  of  freedom  of  cost  has  been  infringed 
upon.  If  formerly  every  form  of  charge  in  accident  or  invalidity 
insurance  was  rejected  as  unsocial,  it  is  now  gradually  being 
realized  that,  under  certain  circumstances,  the  introduction  of 
certain  "inconveniences"  to  serve  as  safeguards  for  the  whole 
people  is  desirable. 

THE  REFORM  OF  THE  SMALL  PENSIONS  FOR  PARTIAL  DISABILITY. 

The  minute  gradation  of  pensions  in  cases  of  partial  disability 
formed  one  of  the  greatest  difficulties  at  the  time  of  the  introduc- 
tion of  workingmen's  insurance.  The  scale  ran  from  5%  to 
100%,  and  complicated  lists  were  worked  out  for  the  purpose  of 
reckoning  the  pensions  for  partial  disability  in  percentages  of  the 
pensions  for  total  disability.  In  order  to  observe  the  letter  of  the 
law,  it  was  endeavored  to  measure  every  injury  no  matter  how 
trivial  in  terms  of  money.  Unimportant  finger  hurts,  which  were 
hardly  of  any  moment,  were  compensated  with  an  indemnity  of 
6%.  Soon  the  workingmen  realized  the  fact  that  it  was  very  easy 
to  obtain  such  small  pensions.  For  simulation,  exaggeration  and 
the  "conservation"  of  petty  instances  of  stiffness  in  the  joints  was 
not  difficult.  In  consequence  of  this,  these  small  pensions,  desig- 
nated by  the  common  people  as  drink  money  pensions,  became 
very  quickly  widespread.  And  nothing  has  contributed  so  much 
to  the  development  of  the  pension  mania  as  this  insignificant 
beginning. 

For  this  reason  the  Imperial  Insurance  Office  decided  to  inter- 
pose a  barrier  to  such  practices  by  declaring  in  a  decision  ren- 
dered on  October  5th,  1901 :  "As  a  rule  pensions  of  less  than  10% 
are  not  to  be  granted,  because  experience  shows  that  the  degrees 
of  disability  taxable  at  less  than  W%  are  not  regarded  as  a 
measurable  loss  in  industrial  life."(3) 

In  medical  circles,  the  attitude  was  taken  that  this  limitation 
would  not  suffice.  Sachs,  for  example,  believed  that  any  loss  in 
working  capacity  of  less  than  26%  ought  not  to  be  compensated. 
In  other  quarters  also  the  demand  was  made  for  the  abolishment 
of  pensions  for  disabilities  of  less  than  26%  or  20%. 


C1)  Abgeordneter  Hoch  declared  on  March  21st,  1912,  in  the  Reichstag: 
"We  have  even  conceded  that  the  costs  of  the  medical  report  (furnished 
by  the  physician  named  by  the  workman)  may  be  imposed  on  the  work- 
man if  the  court  is  of  the  opinion  that  the  report  is  unnecessary." 

(2)  See  §1596,  cf.  also  §1681. 

(3)  See  p.  226  of  Breithaupt's  collection,  cited  elsewhere. 

And  in  §1670 :  "At  the  hearing  it  is  to  be  officially  inquired  into  whether 
and  to  what  extent  the  losing  party  is  to  reimburse  the  other  side  for 
its  costs." 

70 


In  its  draft  of  an  Imperial  Insurance  Code,  the  government 
made  another  proposition.  The  small  pensions  for  partial  dis- 
ability were  to  remain  in  existence,  but  were  to  be  placed  in  a 
category  by  themselves  through  the  provision  that  it  should  be 
permissible  to  grant  pensions  which  amounted  to  20%  or  less, 
for  a  fixed  period  only.  This  time  limitation  of  the  pension 
grant  was  not  to  be  appealable.  (x) 

Thereby  the  government  desired  to  bring  it  about  that  work- 
ingmen  who  had  received  unimportant  injuries  should  exert  them- 
selves to  overcome  the  difficulty  by  accommodation  and  adapta- 
tion. It  was  desired  to  exert  some  sort  of  pressure,  which  could 
not  possibly  be  regarded  as  a  hardship,  inasmuch  as  it  referred 
only  to  disability  cases  of  less  than  25%.  Nevertheless,  the  pro- 
position aroused  dissatisfaction  in  workingmen's  circles.  The 
leading  parties  in  the  Reichstag  not  only  rejected  it,  but  took  the 
opportunity  to  criticise  the  Imperial  Insurance  Office  sharply  for 
endeavoring,  through  its  judicial  bodies,  to  do  away  with  the 
small  pensions.  Here  again  also  electoral  campaign  exigencies 
stand  in  the  way  of  granting  demands  required  by  circumstances. 

THE  QUESTION  OF  LUMP  SUM  PAYMENTS. 

For  years  past  the  question  has  been  agitated  whether 
the  attendant  evils  of  accident  insurance  legislation  could  not  be 
done  away  with  if  in  certain  cases  use  were  made  of  a  single 
lump  sum  payment  in  place  of  a  pension.  From  the  outset,  it 
was  clearly  foreseen  that  a  system  of  lump  sum  payments  con- 
tained certain  dangers  inasmuch  as  a  part  of  the  workingmen 
would  not  be  competent  to  make  a  proper  use  of  a  money  payment 
and  would  ultimately  become  dependent  on  poor  relief.  This 
drawback  exists  beyond  all  question;  but  to  mention  it  by  no 
means  settles  the  question  whether  a  system  of  lump  sum  pay- 
ments is  to  be  recommended  or  not.  For  if  the  least  worthy  of 
the  population  is  perhaps  unfavorably  affected  thereby,  the  great 
mass  of  average  workers,  on  the  other  hand,  would  be  prevented 
from  falling  victims  to  chronic  disease.  And  this  is  the  most  im- 
portant circumstance  of  all  to  consider. 

As  a  matter  of  fact,  a  series  of  observations  have  been  made 
according  to  which  it  would  seem  desirable  to  make  use  of  a 
system  of  lump  sum  payments.  In  1907,  the  meeting  of  the 
South-West  German  Neurologists  and  Alienists  was  devoted  to 
this  question.  A  general  inquiry  resulted  in  showing  "that  all 
physicians  who  had  any  available  data  on  the  subject,  and  who 
compared  the  course  of  traumatic  neuroses  where  the  pension 
and  the  lump  sum  payment  systems  prevailed,  were  convinced  of 
the  greater  efficacy  of  the  latter  method."  Without  doubt,  there 
are  many  cases  where  the  course  of  the  disease  is  not  at  all  af- 
fected by  the  kind  of  compensation  paid.  But  as  the  chairman 
of  the  meeting  declared,  the  number  of  cases  of  traumatic  neu- 

0)     §654  des  Entwurfs  einer  Reichsversicherungsordnung. 

71 


sis  favorably  influenced  by  lump  sum  payments  is  more  than  half 
of  all,  of  which  a  great  part  recovered  their  former  full  working 
capacity.  Compared  to  the  usually  poor  showing  made  in  these 
cases  under  the  present  system  of  pension  payments,  this  is  truly 
a  brilliant  outcome. 

The  explanation  of  this  is  to  be  found  in  the  fact  that  a  lump 
sum  payment  does  away  with  the  nervous  strain  brought  on  by 
the  litigation  for  a  pension.  For  a  lump  sum  payment  results  in 
a  final  determination,  whereas  an  accident  pension  is  invariably 
granted  "subject  to  revision."  (x)  While  the  one  pensioned  is 
continually  under  observation,  after  the  making  of  a  lump  sum 
payment  the  workman  enjoys  entire  freedom  of  movement.  He 
is  able  to  consider  himself  again  as  a  well  man,  is  again  able  to 
compete  and  acquires  thereby,  as  well  as  through  his  having  been 
placed  in  a  stronger  financial  position,  the  possibility  of  again 
making  his  way  upwards. 

After  the  encouraging  preliminary  labors  of  the  South-West 
German  meeting,  the  2nd  International  Congress  for  Accident 
Surgery  (1909)  made  the  subject  one  of  the  topics  to  be  dis- 
cussed. Thus  an  international  discussion  was  started  in  which 
the  experience  of  Switzerland  and  Denmark  were  cited  with 
particular  effect. 

In  Switzerland,  lump  sum  payments  were  customarily  made 
in  cases  where  nervous  troubles  developed  from  accident.  The 
new  Federal  statute  has  expressly  dealt  with  this  condition  of 
affairs  in  Article  82 :  "If  a  marked  improvement  in  the  health 
of  the  insured  is  not  to  be  anticipated  from  a  continuation 
of  the  medical  treatment,  while  the  assumption  be  yet  justified 
that  the  insured,  after  his  claim  for  compensation  has  been  deter- 
mined and  after  he  has  resumed  his  work,  will  attain  his  former 
working  capacity,  the  indemnities  theretofore  paid  are  to  cease 
and  the  insured  is  to  receive  a  lump  sum  payment  instead  of  a 
pension.  The  amount  of  the  lump  sum  payment  is  equal  to  the 
cash  value  of  a  stationary  or  gradually  falling  pension  for  three 
years  at  the  outside :  this  pension  is  determined — at  the  time  the 
lump  sum  payment  is  measured — on  the  basis  of  the  yearly  salary 
previously  earned  by  the  insured  and  according  to  his  state  of 
health  and  according  to  the  degree  of  his  disability." 

The  results  of  investigations  are  at  hand  concerning  the  suc- 
cess of  lump  sum  payments  in  Switzerland.  With  these  as  a 
basis,  Naegeli(2)  came  to  the  conclusion  that  the  settlement  of 
accidents  through  lump  sum  payments  was  to  be  regarded  as 
nothing  more  or  less  than  causal  therapeutics,  "If  even  frequently 
a  conscious  exaggeration  played  some  part,  nevertheless  through 
the  final  determination  of  all  legal  claims  the  factor  is  removed 


C1)  Even  the  "permanent  pension,"  mentioned  in  the  Reichrversicher- 
ungsordnung  (§609)  is  granted  "subject  to  revision."  It  can  be  deter- 
mined anew,  at  intervals  of  at  least  a  year. 

(')     Korrespondenzblatt     fur  Schweizer  Aerztl.  for  1910,  No.  2. 

72 


which  before  prevented  the  people  from  getting  well."  Later, 
Naegeli  writes  to  Laquer^1)  "I  believe  I  am  able  to  assure  you 
that,  in  Switzerland,  accident  neuroses  are  generally  settled  with 
lump  sum  payments  and  are  cured  by  them  ...  In  Switzer- 
land, there  are  no  unhealed  neuroses  two  years  after  lump  sum 
payments  are  made — at  least  during  the  continuation  of  my  re- 
searches I  was  not  able  to  find  a  single  case  anywhere." 

Still  more  interesting  is  Denmark's  experience,  because  lump 
sum  payments  have  been  used  there  since  the  introduction  of  the 
accident  insurance  law  of  1898,  and  because  the  workmen's  in- 
surance board  possesses  broad  powers  of  adapting  this  system 
to  all  requirements.  In  Denmark  the  conclusion  has  been  reached 
that  lump  sum  payments  are  most  efficacious  if  made  in  two  in- 
stallments. Wimmer  explains  this  in  the  following  words :(2) 
"As  soon  as  the  injured  man  is  known  to  be  suffering  from  a 
traumatic  neurosis,  he  is  granted  a  provisional  indemnity — based 
on  the  then  existing  circumstances — of  1,000  marks  on  the  aver- 
age. 51.9%  of  all  cases  are  healed  by  means  of  this  lump  sum 
payment.  From  one  to  two  years  later,  if,  by  special  examina- 
tions and  evidence  of  the  actual  working  capacity  of  the  injured, 
a  greater  degree  of  invalidity  than  was  originally  assumed,  is 
proved  to  exist,  the  remaining  cases  receive  a  further  final  lump 
sum  averaging  1,300  marks."  According  to  Wimmer's  asser- 
tions, 93.6%  of  all  cases  were  cured  in  this  way. 

Up  to  this  time,  German  workmen's  insurance  has  made  but 
little  use  of  lump  sum  settlements.  The  Accident  Insurance  Law 
of  1884  spoke  of  lump  sum  payments  for  foreign  workmen  only. 
Not  until  the  supplementary  law  of  1900  was  the  workingman 
given  the  right  to  ask  for  a  lump  sum  payment  in  cases  where  a 
pension  of  15%  or  less  was  awarded  him.  The  main  requisite  for 
the  granting  of  a  lump  sum  payment  was,  therefore,  the  action  of 
the  workman  himself,  and  this  action  was  besides  carefully  safe- 
guarded. (8)  More  particularly  the  workman  was  given  the  right 
to  withdraw  his  motion,  even  in  the  appeal  court.  Therefore, 
he  could  afford  to  wait  and  see  from  the  course  of  the  negotia- 


(*)     Laquer:   Die  Heilbarkeit  nervoser  Unfallfolgen,  at  p.  19. 

(2)  Wimmer      (Copenhagen)  :     Die     Prognose     der     traumatischen 
Hysteric  und  ihre  Beeinflussung  durch  die  Kapitalabfindung.    Zentralbl.  f. 
Nervenheilk.  u.  Psych,  for  1910,  at  p.  117. 

(3)  §95  of  the  Gewerbeunfallversicherungsgesetzes :  "If  a  pension  of 
15%  or  less  is  awarded  in  cases  of  partial  disability,  the  employers'  as- 
sociation  may  award   the   party  entitled   to   compensation  a   lump   sum 
payment  upon  his  moving  therefor  and  after  the  minor  administration 
officials  have  been  heard.    Before  his  demand  is  granted,  it  must  be  made 
clear  to  the  injured  party  that,  even  if  his  condition  should  become  very 
much  worse,  he  will  have  no  further  right  to  a  pension  once  the  lump 
sum  payment  has  been  made.     An  appeal  is  permissible  from  the  decree 
determining  the  lump  sum  payment.    In  such  a  case,  the  taking  of  an  ap- 
peal has  the  effect  of  arresting  the  judgment.     Until  the  decision  in  the 
appeal  proceedings  is  announced,  the  workingman's  motion  can  be  with- 
drawn." 

73 


tions  whether  he  could  hope  for  a  large  lump  sum  payment.  For 
his  greater  protection,  he  could  make  his  motion  "conditional" 
or  add  a  "conditional"  withdrawal :  "I  withdraw  my  motion  un- 
less a  lump  sum  payment  of  2,000  marks  is  awarded  me." 

This  allowance  of  lump  sum  payments  in  the  place  of  pensions 
for  small  disabilities — which  is  surrounded  with  so  many  safe- 
guards— had  the  result  of  increasing  the  number  of  lawsuits  still 
more.  Made  secure  by  the  conditional  withdrawal,  the  workmen 
are  able  to  haggle  concerning  the  amount  of  the  lump  sum  pay- 
ments^1) The  government,  therefore,  tried  to  make  the  sys- 
tem of  lump  sum  payments  effective  by  proposing  in  its  draft 
of  an  Imperial  Insurance  Code  that  pensions  of  2Q%  or  less 
should  be  settled  by  lump  sum  payments  if  the  employers'  asso- 
ciation in  conjunction  with  the  Imperial  Insurance  Office  should 
agree  thereto.  In  accordance  with  the  experience  gathered 
abroad,  the  allowance  of  lump  sum  settlements  was  not  to  be 
made  dependent  on  the  workingman  making  a  special  motion 
therefor,  as  it  was  believed  that  the  consent  of  the  Insurance 
Office  and  the  decision  of  the  court  of  first  resort  (Oberversicher- 
ungsamt)  fully  sufficed  to  guard  against  abuses.  Nevertheless, 
the  majority  of  the  Reichstag  was  of  a  different  opinion  and 
inserted  as  a  third  requisite  "the  consent"  of  the  workman. 

Lump  sum  payments,  therefore,  play  only  an  unimportant  role 
in  German  workingmen's  insurance.  The  results  of  party  strug- 
gles can  be  observed  also  in  the  way  this  question  has  been 
treated ;  but  here  there  are  also  at  work  tendencies  whose  favor- 
able development  may  be  looked  forward  to  with  hope. 

CONCLUSION. 

Whoever  has  carefully  observed  the  tendencies  which  have 
revealed  themselves  in  the  movement  for  reform,  cannot  help 
noticing  that — besides  the  conflicting  interests  of  workmen  and 
employers — there  are  two  great  tendencies  working  in  opposite 
directions. 

On  the  one  hand,  there  is  the  endeavor  to  procure  greater 
benefits  for  the  workingmen,  and  not  only  to  raise  the  amounts  of 
the  pensions,  but  also  to  make  easier  the  attainment  of  a  pen- 
sion. As  I  have  already  explained,  electoral  campaign  motives 
play  a  great  part  therein.  Nevertheless,  I  am  far  from  asserting 
that  such  motives  solely  are  controlling.  With  many,  rather,  the 


C1)  Concerning  this  haggling,  the  Imperial  Insurance  Office  ren- 
dered the  following  decision  on  May  25th,  1908 :  The  declaration  of  the 
workman  before  the  arbitration  court  that  he  withdraws  his  motion  for 

a  lump  sum  payment  unless  a  payment  of  marks  is  awarded 

him  is  permissible.   Permissible  also  is  the  conditional  motion:  ("I  move 

for  a  lump  sum  payment  on  condition  that  marks  are  awarded 

me.")  The  declaration  of  the  workman  in  the  appeal  court  that  he  would 
now  be  satisfied  with  a  smaller  sum  is  deemed  a  new  lump  sum  settle- 
ment offer  in  regard  to  which  the  employers'  association  must  decide 
anew  by  filing  a  decree. 

74 


desire  to  increase  the  amount  of  the  insurance  pensions  and  to 
make  their  attainment  easier  is  due  to  the  conviction  that  it  is  in 
the  interest  of  the  whole  population  to  insure  the  working 
strength  and  to  increase  the  consuming  power  of  the  broad  masses 
of  the  people. 

On  the  other  hand,  the  opinion  is  gaining  ground  that  we  are 
in  reality  arriving  at  the  opposite  of  what  was  intended.  For 
working-men's  insurance  legislation  is  showing  undesirable  moral 
and  hygienic  results,  which  were  originally  regarded  as  a  neces- 
sary evil  but  which  are  gradually  making  the  blessings  of  work- 
ingmen's  insurance  appear  very  questionable.  The  material  to 
prove  the  correctness  of  this  proposition  is  growing  incessantly. 
The  most  prominent  physicians  are  warning  against  the  threat- 
ened consequences;  and  no  one  has  the  right  to  designate  these 
physicians  as  "anti-social"  who  have  had  the  courage  to  give 
utterance  to  opinions  displeasing  to  the  toiling  masses. 


75 


PART  THREE. 

THE  MISUSE  OF  SOCIAL-POLITY  INSTITUTIONS  IN 
PARTY  POLITICS. 

INTRODUCTION. 

As  promulgators  of  a  better  era  appeared  such  men  as  Abbe 
and  Freese,  who  sought  to  soften  the  hardships  of  the  labor  con- 
flict by  making  use  of  the  workingmen  themselves  in  the  manage- 
ment of  their  business.  Within  the  limits  of  their  narrow  circle, 
they  originated  "the  constitutional  industrial  system;"  and  the 
idea  that  state  social  legislation  should  aid  in  widening  this  circle 
is  a  very  enticing  one.  Community  of  work  combined  with  com- 
munity of  interests  would  alleviate  or  do  away  with  some  of  the 
differences  brought  on  by  class  conflicts. 

The  official  leaders  in  our  social  legislation  are  aware  of  this 
possibility,  and  have  often  referred  thereto  when  the  law  mak- 
ing branch  created  offices  and  administrative  boards  in  which  the 
workingmen  were  to  take  part.  Indeed,  the  government  let  it  be 
known  that  they  regarded  this  branch  of  social  legislation  as  one 
of  the  most  important.  Thus  the  Prussian  Minister  of  Com- 
merce, on  February  16th,  1909,  stated  in  the  Abgeordnetenhaus : 
"If  you  recall  to  mind  what  the  course  of  our  social  legislation 
has  been  during  the  past  twenty  years,  you  will  find  that  no 
country  has  been  so  bent  as  Germany  on  raising  and  improving 
by  legal  measures  of  all  kinds  the  material  condition  of  the  work- 
ingman,  his  social  position  and  his  position  in  industry.  But, 
gentlemen,  we  have  failed,  nevertheless,  to  attain  by  these  meas- 
ures one  of  the  things  which  we  wished  to  attain,  namely,  an 
improvement  in  the  relations  between  master  and  workmen." 
This  object  could  only  be  attained  if  the  workingmen  were  per- 
mitted to  participate  in  some  branches  of  administration,  if,  for 
example,  the  accident  prevention  service  in  mines  (safety  men) 
were  confided  to  the  workers.  This  is  what  the  government 
demanded;  and  the  minister  supported  the  proposition  in  these 
words:  "If  you  pass  the  law  in  the  form  in  which  it  is  to  be 
submitted,  you  will  create  a  social-polity  work  of  importance,  you 
will  be  doing  something  which  will  enable  us  to  find  our  way 
again  to  the  hearts  of  a  great  part  of  our  German  people.  That 
is  the  reason  why  I  ask  you  to  accept  the  proposition."  And  in 
the  course  of  the  debate  he  repeated  again :  "I  am  of  the  assured 
conviction  that  we  hereby  shall  reach  the  way  along  which  the 
effort  to  win  the  heart  and  soul  of  the  workman  will  not  be 
entirely  fruitless."  In  this  manner,  the  Institute  of  Safety  Men 
was  created,  which  affords  the  workingmen  opportunity  of  per- 


manently  participating  in  the  task  of  protecting  their  lives  and 
health.  The  sickness  societies  were  previously  organized  in  the 
same  manner,  the  miners'  societies,  the  workingmen's  boards 
and  other  institutions.  Common  work  united  to  common  inter- 
ests and  free  from  all  political  entanglements ! 


CHAPTER  I. 

THE  ELECTORAL   CAMPAIGN. 

Common  work  united  to  common  interests  free  from  all 
political  entanglements ! 

Of  course,  it  was  easy  to  foresee  that  great  difficulties  stood 
in  the  way  of  the  realization  of  these  hopes.  It  was  to  be  assumed 
that  the  workingmen  would  fall  back  on  their  organizations  and 
on  their  trade  unions  when  the  time  came  to  prepare  for  the 
elections  to  the  sickness  and  miners'  societies,  etc.,  and  as  the 
German  workingmen's  organizations  are  of  a  pronouncedly  polit- 
ical character,  it  was  to  be  expected  that  the  trade  unions  would 
seek  to  obtain  political  advantages  out  of  the  opportunity  offered 
them.  But  it  was  believed  that  these  difficulties  could  be  over- 
come by  making  the  workmen  participate  in  sober  administrative 
work  and  conferences  concerning  mutual  interests,  and  thereby 
drawing  them  away  from  the  socialistic  agitators  with  their  rosy 
promises  for  the  future.  It  was  hoped  also  that  the  workingmen 
would  soon  come  to  recognize  how  necessary  it  is  for  assuring 
their  own  successful  business  management  to  guard  the  social- 
polity  administrative  bodies  against  the  stormy  vicissitudes  of 
party  politics. 

There  is  one  defect  in  this  line  of  reasoning  which  has  come 
to  be  authoritative  in  many  branches  of  German  social  legislation : 
It  does  not  take  into  account  the  peculiar  party  relations  to  be 
found  in  the  German  Empire.  In  Germany  the  workmen  are  not 
divided — as  in  the  case  of  most  other  industrial  countries — into 
workingmen's  parties  which  only  differ  from  each  other  in  their 
degree  of  radicalism;  but  the  political  organization  of  the  Ger- 
man industrial  laborers  is  rendered  complex  by  differences 
of  religion  and  of  nationality.  This  separation  is  most  pronounced 
in  the  principal  industrial  regions — Rheinland- Westphalia  and 
Upper  Silesia — and  completely  controls  the  political  situation. 
Thus  in  the  Regierungsbezirk  Dusseldorf  with  its  wealth  of  in- 
dustries, the  Social  Democrats  and  Poles  with  36.3%  of  all 
votes  cast  are  opposed  to  and  are  of  practically  the  same  strength 
as  the  Centre  party, 0)  which  has  35.8%  of  all  votes  cast.  In 
the  Regierungsbezirk  Arnsberg,  which  includes  the  industrial 
centres  of  Dortmund,  Bochum,  Gelsenkirchen,  Siegen,  Hamm, 


0)     On  this  point  and  as  to  what  follows,  consult  the  Statistik  der 
Reichstagswahlen,  published  by  the  "Kaiserliches  Statistiches  Amt" 

77 


Iserlohn,  Hagen,  Altona,  etc.,  33.9%  of  all  votes  were  case  for  the 
Social  Democrats,  24.5%  for  the  Centre  party  and  3.9%  for  the 
Poles.  In  the  Regierungsbezirk  Oppeln,  which  includes  the 
Upper  Silesian  industrial  region,  the  Poles  received  30.8%  of  all 
votes,  the  Centre  36.8%  and  the  Social  Democrats  14%. 

And  the  intensity  of  the  conflict  with  its  varying  results  can  be 
judged  even  from  the  sober  tables  of  figures  given  in  the  elec- 
tion statistics.  For  from  one  Reichstag  election  to  another  the 
figures  vary,  so  that  first  the  Social  Democrats  and  then  again 
the  Centre  party  has  the  majority. 

In  order  to  be  properly  prepared  for  the  struggle,  the  three 
parties  have  created  a  secure  foundation  for  themselves  in  the 
workingmen's  trade  unions.  It  is  well  known  that  this  "economic 
ground-work"  idea  was  only  carried  out  by  the  Social  Democratic 
and  Centre  parties  after  a  bitter  contest.  But  today  there  is  no 
longer  any  doubt  that  the  "free  unions,"  which  number  2^  mil- 
lion members,  are  the  most  important  part  of  the  Social  Demo- 
cratic organization.  And  if,  as  some  Roman  fathers  desire,  the 
Centre  Party  should  renounce  the  Christian  unions  (with  about 
350,000  members),  then  the  strength  of  the  Centre  Party  in  the 
principal  industrial  regions  would  be  a  thing  of  the  past. 

Since  the  parties  are  opposed  to  each  other  in  such  bitter 
conflict  and  are  so  thoroughly  dependent  on  the  laborers'  organ- 
izations, it  is  not  surprising  that  the  leaders  make  use  of  every 
means  to  strengthen  the  power  of  their  respective  parties.  Very 
early  it  became  apparent  that  the  social-polity  institutions  formed 
excellent  instrumentalities  for  that  purpose. 

The  Social  Democrats  were  the  first  to  exploit  this  new  pos- 
sibility. The  Centre  Party,  however,  make  no  bones  about  the 
fact  that  it  then  followed  suit:  "Only  in  course  of  time  and — 
after  the  Christian  Workman's  movement  had  gained  in  strength 
and  we  had  said  to  our  supporters :  Don't  let  yourselves  be  treated 
as  of  no  account,  in  allowing  yourselves  to  be  always  pushed  to 
one  side  and  to  be  deemed  unworthy  to  be  a  member  of  the  man- 
aging committee  of  a  local  sickness  society — only  then  did  we 
adopt  the  same  prescription  as  they  (the  Social  Democrats).  We 
had  to  adopt  it  in  order  that  the  Christian  workmen  should  not  be 
completely  forced  out  of  the  sickness  societies." (1)  Quite  right! 
from  the  Centre. 

The  same  motives  came  into  play  in  the  elections  for  the 
miners'  societies,  for  safety  men,  for  workmen's  committees,  etc. 
Thus  in  an  appeal  of  the  Bochumer  Volksblatt  it  is  stated  that 
"the  elections  for  the  miners'  societies  for  the  region  of  the  Ruhr 
are  merely  the  preliminary  for  the  next  Reichstag  election  and  the 
regularly  planned  assemblage  for  all  exploiters  and  those  opposed 
to  workingmen's  interests." 


C1)     Remarks   of  the   Centre   Abgeordneter   Becker-Arnsberg  in   the 
Reichstag  on  May  llth,  1911. 

78 


After  the  elections,  which  had  been  conducted  with  every 
possible  resort  to  party  politics,  were  over,  the  Bergarbeiterzeit- 
ung  wrote : 

"With  us  the  People! 
"With  us  Victory ! 
"The  Result  of  the  Election : 

"In  the  general  election  held  on  Saturday,  September 
17th,  1910,  for  elderships  in  the  Society  of  Miners  of 
the  Ruhr,  out  of  a  total  of  419  districts  there  were  se- 
cured by  the 

"Mine  Workers  Union  299 

"Trade  Union  and  Miners  Hotch-Potch.       83 

"Polish  Professional  Union  29 

"Miners  party  alone 7 

"Up  to  the  present  time,  we  have  not  been  informed 
regarding  the  outcome  of  the  electoral  contests  in  the 
missing  districts.  As  representatives  from  419  districts 
must  have  been  elected,  210  of  which  constitute  an 
absolute  majority,  the  Mine  Workers  Union  has  there- 
fore 89  seats  more  in  the  college  of  elders  than  are 
necessary  for  an  absolute  majority! 

"According  to  the  statement  of  the  West  German 
Arbeiter  Zeitung  of  August  20th,  1910,  previous  to  the 
election,  the  Mine  Workers  Union  possessed  235,  the 
Miners  Trade  Union  of  the  Centre  Party  about  130. 

"According  to  this,  therefore,  the  Mine  Workers 
Union  gained  64  districts  on  last  Saturday  and  the  Trade 
Union  lost  41.  In  the  general  election  for  elders  held 
on  September  10th,  1904,  the  Mine  Workers  Union 
secured  174,  the  Trade  Union  acting  then  as  now  in  con- 
nection with  the  mining  interests,  111  districts.  The 
Mine  Workers  Union  has  thus  secured  125  districts 
more,  and  the  Trade  Union  28  districts  less  than  in 
1904. 

"To  foot,  to  horse  and  to  wagon 
"The  Lord  has  routed  them ! 

"This  was  a  fight!  Such  a  contest  for  the  office  of 
elder  has  never  occurred  before.  Things  were  pretty 
hot  in  1904,  but  this  has  put  in  the  shade  everything 
that  has  heretofore  occurred." 

The  same  tone  is  assumed  in  elections  for  safety  men:  "The 
Ruhr  basin  to  the  Mine  Workers  Union!  (that  is,  the  so-called 
Old  Union  which  belong  to  the  Social  Democratic  Party).  As 
in  the  case  of  all  miners'  elections,  in  the  elections  for  safety 
men  much  the  larger  majority  of  those  elected  must  consist  of 
members  of  the  union."  (1) 

And  when  this  election  also  resulted  in  a  victory  for  the  Social 


Bergarbeiterzeitung  of  June  18th,  1910. 
79 


Democrats,  the  jubilant  announcement  could  be  made:  In  the 
lower  Rhenish-Westphalian  industrial  district,  the  working 
miners,  consisting  of  almost  350,000  men,  had  elected  1,552 
safety  men,  of  which  1,055  belonged  to  the  "Old  Union"  and 
only  304  to  the  Trade  Union  of  Christian  Workmen. 

Nevertheless,  all  such  examples  fail  to  give  any  adequate  idea 
of  the  fever  heat  developed  by  the  electoral  contests  as  soon  as 
the  time  for  the  "social  elections"  approaches.  The  working  popu- 
lation, which  was  quietly  attending  to  its  business,  is  suddenly 
aroused  by  agitators  in  the  bluntest  way.  The  workmen,  who 
believed  in  this  instance  that  they  ought  to  select  respectable, 
trustworthy  representatves  for  the  social  insurance  administra- 
tion boards,  learn  that  "much  more  is  at  stake,"  that  "the  political 
future"  is  involved  and  also  a  "fight  against  capitalistic  exploita- 
tion." A  few  days  before  election  time,  the  workingmen's  meet- 
ings are  apt  to  be  so  jammed  that  no  hall  suffices.  At  the  same 
time,  the  electoral  campaign  takes  on  a  form  which  for  virulence 
of  language  far  exceeds  the  worst  expressions  used  in  political 
contests.  Thus,  for  example,  a  circular  with  the  following  con- 
tents made  its  appearance  shortly  before  the  miners'  elections : 
"Attention!  Trade  Union  Members!  Attention! 

"August  Brust,  the  chairman  of  our  Trade  Union, 
received  on  Tuesday,  the  6th  inst.,  from  the  mine  owners 
the  sum  of  30,000  marks  for  his  own  personal  use  as  a 
reward  for  his  trouble  in  fighting  the  oppositional  elder 
and  the  old  Mine  Workers  Union. 

"We  members  of  the  Union  protested  most  vigor- 
ously against  this  betrayal  of  labor  on  the  part  of  our 
chairman  Brust  and  implored  him  to  resign  his  office 
at  once  in  order  to  save  our  Union  from  destruction. 

"Our  Union  certainly  was  not  created  for  the  purpose 
of  aiding  the  mine  owners  and  of  helping  Brust  to  be- 
come a  wealthy  man.  Brust  has  betrayed  us  poor  mem- 
bers for  30,000  marks  and  has  become  a  Judas,  the 
betrayer  of  our  Union. 

"A    member    of    the    Managing    Committee    of    the 

Christ.    Trade  Union." 

The  consequence  of  this  untrue  report  was  a  brilliant  victory 
of  the  Social  Democratic  candidate.  In  the  hearing  before  the 
court,  however,  it  was  proven  that  the  circular  was  concocted 
by  an  employee  of  the  Social  Democratic  Union  and  was  pub- 
lished n  the  printing  office  of  a  Social  Democratic  Paper  appear- 
ing in  Cologne.  It  was  further  judicially  determined  that  the 
chairman  of  the  Social  Democratic  Union  was  informed  as  to 
the  circular  already  before  the  election  and  yet  "had  not  looked 
out  for  the  public's  enlightenment  as  the  occasion  called  for." 
(Judgment  of  the  criminal  court  of  Essen,  November  19th,  1909.) 
After  the  pattern  set  in  Rhenish-Westphalian  election  contests, 
similar  conditions  developed  in  Upper  Silesia.  There  the  fight 

80 


for  control  of  the  social-polity  institutions  is  one  of  the  chief 
means  of  strengthening  the  position  of  the  Polish  Workingmen's 
Party.  Conditions  in  Saxony  are  hardly  less  acute.  As  to  these, 
the  Dresdener  Volkszeitung  says : 

"The  election  for  the  local  sickness  society  has  shown 
again  that  the  Dresden  organized  labor  element  was  to 
be  relied  upon  and  that  the  fruit  of  those  following  tor- 
tuous   ways     and    of     the     we-are-also-workingmen's 
organizations  does  not  flourish  here.     In  trade  union 
matters  the  Dresden  labor  population  seeks  to  be  repre- 
sented only  by  the  free  labor  unions,  and,  in  political 
matters,  only  by  the  Social  Democratic  Party.    It  shows 
this  also  in  all  elections  of  a  social-polity  nature."  (1) 
How  far  astray  from  actual  realities  was  the  assumption  that 
the  participation  in  elections  in  social-polity  institutions  would 
serve  as  a  means  of  conciliation — because  every  workman  would 
be  interested  in  having  as  competent,  business-like  and  impartial 
men  as  possible  in  the  various  administration  branches — and  the 
hope  that  desire  for  good  business  management  would  lessen 
political  differences!     In  reality  the  "social"  electoral  campaign 
suffices  of  itself  to  keep  the  workmen  constantly  excited  and  to 
make  them  constantly  more  subject  to  the  influence  of  political 
agitation. 


CHAPTER  II. 

PARTY  RULE. 

Unless  after  the  close  of  an  election  campaign  some  new 
means  could  be  found  for  keeping  party  politics  alive,  even  the 
most  furious  election  contest  could  not  permanently  endanger  the 
purpose  of  social  institutions.  The  legislature  has  therefore  care- 
fully sought  to  prevent  all  political  exploitation  of  social  legisla- 
tion administrative  bodies.  The  various  positions  filled  by  the 
workingmen  are  always  carefully  surrounded  by  safeguards. 
Nevertheless,  actual  experience  has  shown  that  almost  always 
ways  and  means  have  been  found  for  party  politics  to  creep  in. 

It  is  well  known  that  the  government  demanded  a  participa- 
tion by  the  workingmen  in  the  administration  of  social  institu- 
tions principally  because  "a  defection  of  our  workmen  from  the 
Social  Democratic  Party  was  looked  forward  to."(2) 

The  assertion  of  the  employers  that  in  reality  just  the  opposite 
would  occur  because  the  chosen  representatives  of  the  working- 
men  would  be  selected  entirely  according  to  their  political  beliefs 
and  in  order  to  spread  the  doctrines  of  their  party — this  asser- 


C1)     Compare  the  Reichstag  session  of  May  llth,  1911. 
(2)     Expression  of  the  Prussian  Minister  of  Commerce  in  the  Abge- 
ordnetenhaus  on  November  29th,  1910. 

81 


tion  could  not  be  expected  to  have  much  weight  given  it  as  it 
expressed  merely  the  opinion  of  interested  parties.  It  is  there- 
fore all  the  more  interesting  to  observe  what  the  state  officials 
themselves  now  say.  On  October  25th,  1910,  the  Prussian  Min- 
ister of  Commerce  declared  that  "the  best  planned  measures  in 
their  operations  run  the  risk  of  being  turned  into  the  opposite  of 
what  are  intended"  because  in  the  elections  for  social  institutions 
"not  above  all  else  the  attainments  and  the  experience  of  the  one 
selected,  but  rather  the  degree  of  his  political  radicalism  is  deter- 
minative." And  the  reports  of  the  state  Revierbehorden  confirm 
this  assertion  in  every  respect^1) 

The  persons  thus  chosen  "according  to  the  degree  of  their 
political  radicalism"  are  entrusted  by  law  with  certain  kinds 
of  inspection  work.  This  creates  a  situation  of  affairs  which  is 
extremely  favorable  for  the  victorious  party.  In  the  labor  press, 
there  is  a  stock  heading,  which  is  never  out  of  date,  reporting  how 
the  victorious  Social  Democratic  inspectors  proceed  gently 
against  members  of  their  own  organization  while  on  the  other 
hand  they  annoy  those  belonging  either  to  "no  organization" 
or  to  a  "false  organization"  by  a  system  of  repeated  checking 
until  they  become  members  of  the  Social  Democratic  organiza- 
tion. Indeed,  as  has  been  judicially  determined, (2)  agitation  on 
behalf  of  the  party  is  openly  carried  on.  Thus,  for  example, 
the  morning  before  an  election  for  a  substitute,  a  safety  man 
posted  the  following  announcement  on  the  bulletin  board  re- 
served for  official  communications : 

"Announcement 

of  the  pay  station To 

the 190         in 

"Attention !  District  VIII.  Attention ! 
"The  Mine  Workers'  Union  (the  so-called  "old" 
Social  Democratic  union)  presents  to  you  as  candidate 
for  the  office  of  safety  man,  the  election  for  which  is  to 
take  place  tomorrow,  September  29th,  Miner  Josef  Frie- 
mel.  As  a  matter  of  honor,  every  comrade  should  see 
to  it  that  he  is  unanimously  elected.  If  Griinert,  who 
allowed  himself  to  be  nominated  as  a  rival  candidate 
at  the  last  election,  should  attempt  the  same  thing  again, 
reject  his  candidacy  most  decisively  because  as  a  non- 
unionist  he  cannot  be  considered  by  us  any  more,  but 


C1)  Thus  one  reads  in  the  annual  report  for  1911  of  the  Royal 
Prussian  Government  and  Industrial  Privy  Councillors  and  Mining 
Officials,  at  p.  633 : 

"By  the  end  of  August,  when  from  60  to  70  per  cent,  of  the  elections 
for  these  positions  had  been  held  under  very  active  participation,  it  was  re- 
vealed that  frequently  not  personal  efficiency  and  professional  experience 
were  what  turned  the  scales,  but  rather  that  adherence  to  a  certain  organ- 
ization and  political  belief  played  a  more  important  part  in  the  election." 

(2)  Decision  of  the  Berggewerbegericht  Dortmund  Spruchkammer 
for  South  Essen  on  November  29th,  1910. 

82 


must  present  himself  as  a  candidate  of  the  mining  inter- 
ests. Our  candidate,  Josef  Friemel,  was  unanimously 
selected,  and  therefore  comrades  can  vote  for  him  with- 
out any  hesitation.  And  now,  comrades,  show  that  you 
are  not  to  be  led  astray  a  second  time  and  that  you  do 
not  intend  to  lag  behind  the  other  districts. 
"Good  wishes  hereto ! 

"(Signature.)" 

Through  a  petition (*)  which,  on  February  1st,  1912,  the 
cial  Democratic  Mine  Workers  Union  addressed  to  the  Abge- 
ordnetenhaus,  it  is  to  be  seen  that  not  merely  a  single,  unim- 
portant instance  is  here  involved.  In  this  document,  the  Union 
expressly  refers  to  this  case  and  advocates  as  a  right  that  a  safety 
man  "aside  from  his  duties  as  safety  man  should  take  an  active 
part  in  the  campaign  for  the  election  of  a  safety  man."  Indeed, 
the  Union  demanded  even  a  change  in  the  law  so  that  workmen 
inspectors  could  not  be  dismissed  on  account  of  such  practices. 

Of  still  more  importance  for  the  party  leaders  is  the  possibility 
of  obtaining — through  making  use  of  the  social  institutions — of  a 
mass  of  material  which  serves  as  a  basis  for  further  demand  and 
as  a  means  of  preparing  for  future  labor  conflicts.  Thus,  for 
example,  when  the  elections  for  safety  men  had  resulted  in  the 
complete  victory  of  the  Social  Democratic  union  and  when  over 
1,000  members  of  this  organization  led  the  miners  as  elected 
representatives,  the  Social  Democratic  union  promptly  availed 
itself  of  the  favorable  opportunity  offered  in  the  following  man- 
ner :  The  law  prescribes  that  the  mine  management  must  provide 
a  special  "mining  journal"  for  each  safety  man  in  which  he  is  to 
enter  his  observations.  Before  long  the  Social  Democratic  union 
distributed  a  second  "mining  journal"  to  the  safety  men  be- 
longing to  its  organization  and  issued  the  following  instruc- 
tions in  regard  thereto: 

"In  this  (2nd  Journal)  the  same  entries  have  to  be 
made  as  in  the  one  at  the  mine.  The  comments  of  the 
manager  or  of  the  accompanying  official  have  to  be  like- 
wise copied.  An  opportunity  for  copying  is  offered  at 
the  time  of  the  next  change  of  shift.  Any  prohibition 
of  such  copying  is  of  no  effect  because  the  entries  are 
to  be  made  in  one's  own  hand  and  it  is  nobody's  business 
how  the  safety  man  acts  or  what  he  does  when  he  writes 
in  the  mining  journal.  He  can  forbid  any  overseeing 
or  tutelage. 

"It  is  further  recommended  to  enter  in  the  book  fur- 
nished by  the  union  any  important  observations  made  re- 
garding conditions  in  the  district,  which  one  is  not 


O  Petition  of  the  managing  committee  of  the  German  Mine  Workers 
Union,  and,  as  belonging  to  this  Union,  of  the  mine  eldership  of  the 
General  Mine  Union  Bochum,  for  a  change  in  the  general  mining  law. 

83 


permitted  to  enter  in  the  book  at  the  mine.  These  ob- 
servations, however,  are  to  be  so  marked  that  one  can 
see  that  they  are  not  contained  in  the  journal  book  at  the 
mine.  Before  these  observations,  one  should  write 
heavily  underlined  and  in  parenthesis:  '(entered  only 
in  this  book.)" 

The  Union  further  demanded  that  its  safety  men  should  note 
the  names  of  the  mine  shift  and  other  particulars,  and  remarked 
as  to  this:  "Note  books  will  be  furnished  by  the  Union." (x) 

Without  further  explanation  being  required,  it  is  evident  that 
in  this  way  voluminous  material  is  gathered  among  the  docu- 
ments of  the  party  leaders.  And,  although  the  organizations  en- 
deavor to  keep  up  outward  appearances,  proof  is  at  hand  to  show 
that  the  party  leaders  are  especially  striving  for  material  to 
serve  campaign  purposes.  In  order  to  comprehend  these  efforts, 
one  should  read  the  following  sentences  which  I  have  taken  from 
the  list  of  instructions  of  the  old  union  ; 

"The  (legal)  ordinances  concerning  safety  men  con- 
tain a  provision  which  has  the  object  of  entirely  elimi- 
nating the  question  of  wages  from  the  scope  of  the 
safety  man's  activities.  .  .  .  Nevertheless,  the  word 
wages  is  often  to  be  heard  at  the  time  of  the  shift 
changes,  but  only  in  the  mouths  of  the  laborers.  As  a 
matter  of  principle,  the  safety  man  is  never  allowed  to 
inquire  as  to  the  amount  of  wages.  On  a  complaint  as 
to  a  bad  bargain  having  been  made,  he  must  answer: 
Comrades,  I  am  forbidden  to  give  the  answers  which  I 
would  like  to  make." 

And  one  should  compare  herewith  the  following  circular, 
which  the  same  union  that  gave  this  cautious  advice  addressed 
to  the  safety  men  of  its  organization  and  which  fell  into  un- 
friendly hands  through  an  accident  :(2) 

"German  Mine  Workers  Union. 

"Esteemed  Comrade! 

"As  we  have  now  to  bring  proof  in  our  movement 
for  higher  wages  through  use  of  suitable  and  right  at 
hand  material  to  what  extent  low  starvation  wages  are 
still  being  paid  in  the  present  period  of  high  prices, 
you  are  to  help,  in  so  far  as  it  lies  in  your  power,  to- 


C1)  These  instructions  are  contained  in  a  book  which  bears  the  fol- 
lowing title:  What  are  the  duties  of  safety  men?  Published  by  the 
managing  committee  of  the  Mine  Workers  Union,  1910.  Press  of  E. 
Haussmann  &  Co.  in  Bochum.  It  appears  that  this  book,  of  which  every 
safety  man  of  the  Social  Democratic  Union  received  a  copy,  was  dis- 
tributed "with  every  avoidance  of  publicity."  At  least,  I  only  succeeded 
in  obtaining  a  copy  indirectly,  and  the  owner  of  it  (a  safety  man  of  the 
old  union)  demanded  that  I  send  it  back  by  return  mail  as  he  "was 
afraid  of  being  checked  up  by  the  old  union." 

(2)  The  original  circular  was  shown  me.  It  is  also  printed  in  the 
annual  report  of  the  mine  owners'  union  for  1911  at  p.  43. 

84 


wards  this  end  in  order  that  we  may  receive  suitable 
information  concerning  low-priced  wages  which  have 
been  paid. 

"You  are  to  write  down,  therefore,  on  the  enclosed 
interrogation  blank,  all  low  miners'  wages  within  the 
limits  of  your  inspection  district  which  have  come  either 
to  your  notice  or  to  that  of  a  comrade  known  to  you. 
As  we  have  learned  by  experience,  it  is  difficult  enough 
in  itself  to  obtain  general  statistics  of  wages  and,  in  view 
of  the  short  and  pressing  need  of  time,  absolutely  im- 
possible of  accomplishment. 

"For  this  reason,  in  order  to  refute  the  outcry  of 
the  mine  operators  over  the  high  miners'  wages,  we  wish 
to  bring  about  at  least  an  instructive  tabulation  of  low 
miners'  wages  up  to  five  marks.  As  the  shift-wages  are 
very  much  the  same  in  the  various  mines,  only  an 
answer  is  required  to  the  questions  herewith  submitted. 

"This  statistic  has  to  be  completed  without  fail  be- 
tween now  and  the  next  pay-day.  You  may  therefore 
now  notify  all  comrades  receiving  low  wages  that  they 
are  to  retain  their  wage  books  at  the  next  wage-day  and 
to  hand  them  over  to  you  so  that  their  wages  can  be 
copied,  whereafter  the  wage  book  can  be  returned  to 
its  owner. 

"The  enclosed  sheet  must  be  returned  to  me  cor- 
rectly filled  out  by  December  5th  next  at  the  very  latest. 
Monthly  headings  for  a  whole  quarter  of  a  year  have 
been  provided  for.  If,  however,  the  wages  for  all  three 
months  cannot  be  supplied — whether  on  account  of  a 
change  in  position  or  otherwise — the  report  for  the  last 
month  and  for  the  month  previous  thereto  will  suffice. 

"This  circular  is  enclosed  to  every  safety  man  as 
well  as  a  sheet  to  be  filled  out  which  will  be  handed 
each  one  individually  by  the  overseer.  The  sheet  with 
question  is  also  to  be  returned  to  the  latter,  whereupon 
for  the  purpose  of  saving  postage  he  must  deliver  the 
same  at  my  address. 

"Warmest  Greetings! 

"The  District  Leadership. 
"(Signature.)" 

These  instructions  need  no  commentary,  because  everyone 
knows  without  further  explanation  how  through  the  control 
of  social-polity  institutions  the  posting,  recruiting  and  leader- 
ship of  the  masses  is  made  easier  for  political  party  agitators. 

"Common  work  united  to  common  interests!"  What  has 
one  not  hoped  for  from  this  magic  formula  ?  When  about  thirty 
years  ago  the  organization  of  the  sickness  societies  was  brought 
we  thought  we  already  saw  light  ahead  and  how  the  working- 
men  would  wisely  and  impartially  devote  themselves  to  "ad- 

85 


ministrative  affairs."  Indeed,  it  was  even  assumed  as  a  matter 
of  course  that  the  employers,  although  condemned  to  be  in 
minority,  would  be  able  to  secure  for  themselves  "through  the 
weightiness  of  their  reasons"  a  sufficiently  effective  influence  in 
the  administration  of  social  institutions  even  in  the  face  of  a 
majority  constituted  by  the  workingmen. 

How  much  "psychological  wisdom"  was  expended  in  defend- 
ing this  hopeful  belief!  How  indefatigably  did  one  explain  the 
contrary  facts  away  as  "temporary  symptoms"  and  "children's 
diseases!"  And  yet  the  experience  of  the  last  decades  clearly 
proves  that  the  psychology  of  social-polity  institutions  is  much 
simpler  than  was  supposed.  For  every  labor  leader  knows  that 
through  the  control  of  social  institutions  three  important  political 
ends  can  be  attained.  First :  an  exact,  thorough  survey  of  condi- 
tions combined  with  the  collection  of  material  that  can  "be  put  to 
use."  Secondly :  the  carrying  out  of  a  more  thorough  system  of 
party  recruiting.  Thirdly:  the  provision  for  members  who  have 
worked  for  the  party  of  positions  of  influence  or  with  pay. 

In  a  country  where  several  mighty  parties  are  fighting  with 
the  greatest  possible  energy  for  labor  votes,  the  labor  leaders 
could  not  allow  such  possibilities  to  escape  them!  Therefore 
the  beautiful  idea  of  "common  work  united  to  common  interests" 
had  to  fade  away. 


In  this  chapter,  I  have  intentionally  not  referred  in  detail  to 
those  social-polity  institutions  in  which  party  rule  makes  the  most 
unpleasant  impression,  namely,  the  local  sickness  societies.  To 
give  a  detailed  account  of  the  abuses  which  have  been  developed 
among  them  appears  to  me  to  be  superfluous,  because  the  public 
has  been  sufficiently  informed  in  the  recent  debate  on  the  Imperial 
Insurance  Code  as  to  how  the  local  sickness  societies  have  been 
misused  in  order  to  provide  positions  with  salaries  for  deserv- 
ing party  agitators  and  in  order  to  insure  them  a  life  tenure  in 
their  positions  by  peculiar  contracts  of  employment  (I  refer  to 
the  so-called  Diisseldorf  contracts). 

At  this  point,  I  would  like  to  refer  to  a  book  which  created 
quite  a  sensation  during  the  consideration  of  the  Imperial  In- 
surance Code :  Dr.  Moller,  Die  Herrschaft  der  Sozial-Demokratie 
in  der  deutschen  Krankenversicherung,  Berlin,  1910.  Moller 
sought  to  prove,  by  making  use  of  very  comprehensive  material, 
that  the  local  sickness  societies  were  controlled  and  misused  by 
the  Social  Democratic  Party.  The  book  had  a  peculiar  history. 
Several  weeks  after  its  first  appearance,  J.  Frassdorf,  in  the  name 
of  the  "Central  Union  of  the  Local  Sickness  Societies  in  the 
German  Empire,"  asked  all  of  the  directorates  of  societies  which 
had  been  attacked  to  bring  an  action  against  the  author  and  to 
prove  in  court  that  Moller 's  assertions  were  untrue.  (This 

86 


public  summons  appeared  on  January  llth,  1911,  in  the  Deutsche 
Krankenkassen-Zeitung.)  At  the  same  time,  Frassdorf  an- 
nounced that  the  Dresden  local  sickness  society,  which  he  him- 
self conducted,  would  proceed  legally  against  Moller.  Further- 
more, the  Social  Democratic  representative  Hoch  declared  on 
May  2nd,  1911,  in  the  Reichstag:  "The  inaccuracy  of  this  bung- 
ling piece  of  work  is  easy  to  demonstrate" ;  and  he  held  out  the 
prospect  of  the  judicial  proceedings  leading  to  the  complete  de- 
molition of  Moller's  book.  All  this  occurred,  while  a  change  in 
the  law  affecting  the  local  sickness  societies  was  being  discussed 
in  the  Reichstag. 

Under  these  circumstances  many  deemed  it  to  be  prudent  to 
speak  of  this  book  with  reservation,  and  the  opinion  arose  that 
Moller's  statements  were  biased  and  of  doubtful  reliability,  an 
opinion  which  is  still  generally  prevalent  today.  Nevertheless, 
it  did  not  appear  quite  right  to  me  to  pass  judgment  on  the  book 
based  on  the  "prevailing  opinion."  I,  therefore,  made  inquiries 
concerning  the  outcome  of  the  advertised  lawsuits  against 
Moller's  book.  I  arrived  at  the  following  interesting  result: 

Since  Moller  in  his  book  criticises  more  than  a  hundred  of  the 
great  local  sickness  societies  and  accuses  almost  all  of  them  of 
"terrorism,"  "favoritism,"  etc.,  as  well  as  reciting  some  very 
unpleasant  facts,  and  since  J.  Frassdorf,  the  head  of  the  entire 
organization,  had  openly  asked  that  Moller  be  judicially  pursued 
and  had  especially  notified  the  directorates  of  all  sickness  societies 
which  had  been  slightingly  referred  to  in  the  book,  it  was  to  be 
assumed  that  a  mass  of  litigation  would  result.  Nevertheless, 
only  three  suits  in  all  were  brought  against  Moller,  among  which 
was  a  suit  brought  by  the  directorate  of  the  Dresden  local  sick- 
ness society,  of  which  Frassdorf  was  a  member  and  chairman. 

Of  these  three  suits,  two  ended  in  a  compromise  in  which 
Moller  conceded  having  made  two  mistakes,  while  his  oppo- 
nents in  both  cases  acknowledged  in  writing  that  Moller  had 
acted  in  good  faith  and  that  he  was  obliged  to  regard  his  in- 
formation as  reliable. 

The  third  suit,  which  was  that  of  the  directorate  of  the 
Dresden  sickness  society,  of  which  Frassdorf  was  the  chairman, 
had  the  following  curious  career.  Although  Frassdorf  acted 
under  the  advice  of  a  lawyer,  the  complaint  was  filed  in  a  court 
which  lacked  jurisdiction  (the  Munich  Amtsgericht) .  The 
Amtsgericht  in  Munich  promptly  referred  the  complaint  to  the 
proper  Amtsgericht  at  Ebersberg.  The  Ebersberg  Amtsgericht 
thereupon  threw  out  the  complaint  with  costs  for  purely  formal 
reasons.  This  was  on  August  19th,  1911.  The  complainant 
allowed  the  14-day  period  to  pass  by  without  taking  an  appeal 
from  the  decision  of  the  Ebersberg  Amtsgericht.  Several  months 
passed  by  without  the  complainant's  handing  in  a  new  complaint 
in  proper  form.  Thus  the  matter  remained  unsettled  during  the 
period  in  which  the  Imperial  Insurance  Code  was  being  con- 


sidered  in  the  Reichstag.  When  the  time  for  the  elections  to  the 
Reichstag  approached,  the  complaint  was  filed  on  December  29th, 
1911,  with  the  court  of  competent  jurisdiction,  but  withdrawn 
again  in  February,  1912,  as  soon  as  the  elections  and  second  bal- 
lots were  over. 

While  these  events  in  themselves  are  very  interesting,  the 
decisive  facts  are  yet  to  be  found  in  the  following :  I  have  already 
mentioned  that,  in  spite  of  the  public  call  therefor,  only  three 
complaints  were  filed  against  Moller's  book.  After  Moller  had 
waited  in  vain  for  the  promised  complaints  on  the  part  of  the 
sickness  society  directorates  disparaged  by  him,  he  determined  to 
turn  the  tables  and  to  formally  accuse  eleven  Social  Democratic 
editors  who  had  criticised  his  book.  Of  these  complaints,  two 
were  rejected  for  formal  reasons  (expiration  of  the  Statute  of 
Limitations).  One  complaint  was  settled  through  the  editor  re- 
tracting his  statements  with  an  expression  of  regret.  The  re- 
maining eight  complaints  all  ended  in  the  editors  being  find  up 
to  400  marks,  besides  being  condemned  to  pay  all  costs  and  being 
also  compelled  to  publish  the  judgment  several  times.  Further- 
more, Moller  was  able  to  file  a  complaint  against  the  directorate 
of  a  local  sickness  society,  which  likewise  led  to  a  conviction  be- 
ing obtained.  Thus  ended  the  "judicial  demolition"  of  Dr. 
Moller's  book,  which  had  been  announced  with  such  a  flare  of 
trumpets. 

From  a  sense  of  literary  duty  I  felt  obliged  to  establish  these 
facts ;  and  I  can  recommend  to  everyone  to  read  this  book,  which 
has  become  so  noteworthy  on  account  of  its  history. 


CONCLUSION, 

THE  LIMITS  OF  SOCIAL  LEGISLATION. 
There  is  no  greater  sin  than  despair,  for  it  leads  to  desperation. 

Whoever  has  observed  the  undesirable  effects  of  German 
social  legislation  and  is  not  afraid  to  follow  the  path  which  leads 
past  strife,  hypocrisy  and  despair,  will  ultimately  find  some  com- 
pensation in  one  certainty  which  stands  out  above  the  noise  of 
party  conflicts.  The  conviction  is  always  becoming  more  pro- 
nounced that  the  undesirable  results  of  social  insurance  legisla- 
tion are  fulfilling  a  historical  mission  since  they  will  bring  about 
a  transformation  of  social  insurance  legislation.  Even  today  it 
will  not  be  easy  to  regard  this  transformation  impartially,  for 
political  interests  and  passions  surround  everything  with  which 
social  legislation  is  concerned.  Nevertheless,  the  present  situa- 
tion of  affairs  requires  that  an  attempt  be  made  to  draw  some 
conclusions  from  the  facts  recited  irrespective  of  whether  the  re- 
sults coincide  with  political  aspirations  or  not. 


Today  nobody  will  any  longer  venture  to  assert  that  social 
insurance  legislation  is  simply  "an  idea  of  the  period,"  which 
has  taken  hold  of  the  minds  with  suggestive  force  and  which  will 
lose  its  magical  effect  with  the  next  generation.  Everybody 
realizes  that  it  was  one  of  the  principal  tasks  of  the  last  half- 
century  to  incorporate  the  laboring  masses  into  our  body  politic, 
and  that  the  task  of  today  is  to  give  the  institution  thus  created 
permanency  and  stability.  Not  a  passing  idea  of  the  period  is  in- 
volved, but  an  elementary  political  occurrence. 

But  one  cannot  overlook  the  fact  that  this  elementary  and 
weighty  occurrence  is  accompanied  and  aided  by  some  sugges- 
tive forces.  Every  period  of  transition  is  illumined  with  hopes 
and  high  expectations,  because  the  best  men  of  such  a  period, 
equipped  with  the  knowledge  of  a  previous  age,  are  striving  to 
bring  about  a  new  and  ideal  condition  of  affairs.  And  certainly 
only  in  such  a  period  of  heightened  energy  could  the  creation  of 
German  workingmen's  insurance  and  workingmen's  protective 
legislation  have  succeeded. 

But  upon  this  era  of  great  and  new  creative  work,  a  period 
of  rest  and  of  taking  stock  did  not  follow,  as  one  might  have 
supposed.  On  the  contrary,  there  followed  on  the  creation  of 
the  fundamental  laws — which  were  passed  in  part  contrary  to  the 
wishes  of  the  working  masses — a  mass  of  new  laws  and  a  stream 
of  new  resolutions.  Party  rivalries,  (*)  therefore,  brought  about 
our  present  epoch,  which  one  can  designate  in  the  domain  of 
social  legislation  as  the  baroque  period.  An  immeasurable  pro- 
duction of  constantly  new  regulations  took  place  which  funda- 
mentally were  nothing  more  than  imitations,  distortions  and 
repetitions :  A  period  which  in  reality  is  comparable  to  that  art 
epoch  of  the  baroque  style  which  distorted  the  simple  and  noble 
lines  of  the  renaissance  era  with  "duplications"  and  arabesques. 

Such  a  characterization  applies  both  to  the  lack  of  limitations 
upon  the  demands  for  the  practical  enforcement  of  the  laws  and 
concerning  their  theoretical  form,  just  as  though  the  object 
were  to  bring  about  a  transformation  of  the  whole  state  with  the 
help  of  the  social-polity  institutions. 

We  have  observed  the  struggles  which  have  made  political 
events  of  social  elections,  and  we  have  become  acquainted  with 
the  methods  by  which  the  victorious  party  turns  its  power  to 
account.  Now  that  the  trade  unions  have  come  to  be  the  founda- 
tion of  a  political  party,  that  party  is  now  seeking  to  get  control 
also  of  the  social  legislative  positions  and  of  the  administrative 
bodies.  In  that  way,  a  power  is  being  developed  whose  deepest 
roots  are  protected  by  the  social-polity  laws  themselves,  a  power 
which  apparently  will  obtain  the  control  in  the  future  because, 
it  looks  for  its  support  to  the  labor  masses,  that  is,  to  the  great 
mass  of  the  voters. 


(*)     Cf.  on  this  point  chapter  2  and  3  of  Part  I,  chapter  5  of  Part  II 
and  Part  III  of  this  book. 

89 


But  forces  are  being  aroused  against  this  apparently  irre- 
sistible power,  through  whose  progress  the  status  of  affairs  is 
being  changed.  The  laboring  masses  have  split  among  them- 
selves and  have  turned  against  each  other  just  exactly  in  the 
field  where  party  politics  had  most  successfully  forced  their  way 
into  social  politics^1) 

The  struggle  of  workman  against  workman  had  this  result 
that  the  Catholic  labor  leaders  invoked  the  aid  of  the  law  against 
the  rule  of  the  Social-Democratic  leaders — a  risk  in  which  they 
succeeded  because  they  could  fall  back  on  the  parliamentary 
might  of  the  Centre  Party.  Thus  they  succeeded  in  putting 
through  the  idea  that  social-polity  institutions  had  to  be  "neu- 
tralized," that  is,  freed  from  political  party  domination.  (2) 

"Neutralization"  of  social-polity  institutions!  The  active  agi- 
tation which  the  Social  Democracy  carried  on  as  a  result  of  this 
demand  against  the  "labor  secretary  politics"  of  the  Centre 
Party,  clearly  shows  that  the  importance  of  this  move  has  been 
clearly  understood.  For  the  present,  the  neutralization  of  a  part 
of  the  social-polity  institutions (3)  is  attempted  by  the  use  of  two 
methods  in  the  Imperial  Insurance  Code.  First,  by  a  very  an- 
cient practice,  the  "itio  in  paries;"  for  the  Imperial  Insurance 
Code  requires  that  to  the  most  important  administrative  questions 
"the  employers'  group"  and  "the  insured  group"  must  each  give 
its  separate  assent.  (4)  The  second  measure,  which  is  always  tc 
be  resorted  to,  if  the  itio  in  paries  has  led  to  no  result,  is  the  in- 
terference of  the  government  authorities. (B) 

Nevertheless,  this  by  no  means  exhausts  the  list  of  forces  at 
work  which  are  favorable  to  a  further  active  intervention  on  the 


0)     See  chapter  1,  Part  III,  "The  Electoral  Contest." 

(2)  Compare  the  discussion  in  committee  and  in  the  committee  of  the 
whole  on  the  Imperial  Insurance  Code. 

(3)  In  sickness  insurance,  which  forms  the  basis  of  workingmen's 
insurance. 

(*)  Thus,  for  example,  §328  of  the  Imperial  Insurance  Code  provides : 
"The  members  of  the  directorate  of  the  local  sickness  society  are  to  choose 
the  chairman  from  among  their  number.  The  one  who  receives  a  majority, 
both  in  the  employers'  and  in  the  workingmen's  group  in  the  directorate 
is  elected."  §345:  "The  resolutions  for  No.  6  and  7  require  a  majority 
both  of  the  employers  and  of  the  insured."  §349:  "In  the  case  of  the 
sickness  societies,  appointments  to  positions  which  are  paid  for  from  the 
income  of  the  society  and  of  all  officials  who  are  under  regular  duties, 
are  made  by  concurrent  resolution  of  both  groups  in  the  directorate." 
§355 :  "Both  in  the  directorate  as  well  as  in  the  executive  committee,  both 
the  employers  and  the  insured  must  decide  separately  regarding  the  as- 
signment of  duties." 

(5)  For  example,  §329:  "If  the  election  does  not  take  place  in  the 
second  sitting,  the  directorate  must  notify  the  Imperial  Insurance  Office. 
The  latter  names  a  substitute,  who  until  the  time  of  a  valid  election  exer- 
cises all  the  rights  and  duties  of  a  chairman  at  the  expense  of  the  sickness 
society."  §350:  "If  no  resolution  as  to  appointments  is  adopted  or  if  the 
approval  is  definitely  refused,  the  Imperial  Insurance  Office  names  at  the 
cost  of  the  society  and  subject  to  its  recall  the  persons  needed  to  carry 
on  the  business,"  etc. 

90 


part  of  the  state  government.  The  elected  representatives  of  the 
workingmen  themselves  help  along  this  movement.  Twelve 
years  ago  one  of  the  best  posted  authorities  (x)  on  our  social 
legislation  called  attention  to  the  fact  that  "among  the  officials 
(generally  appointed  by  the  Social  Democratic  party)  of  the 
local  sickness  societies,  the  desire  had  already  made  itself  notice- 
able for  some  time  past  to  obtain  a  more  secure  hold  on  their 
positions  through  being  invested  with  the  privileges  and  obliga- 
tions of  government  officials."  In  the  course  of  years,  this  move- 
ment has  acquired  more  and  more  force  and  has  led  to  the  result 
that  "the  privileges  and  obligations  of  government  or  communal 
officials"  can,  as  a  matter  of  fact,  be  bestowed (2)  on  the  officials 
entrusted  with  the  business  management  of  the  large  sickness 
societies,  with  the  result  that  these  officials  are  placed  under  the 
provisions  of  the  disciplinary  law. 

But  the  tendencies  which  are  favoring  an  increase  in  the  scope 
of  governmental  administration  are  further  aided  by  the  contest 
in  varied  forms  between  social-polity  institutions.  For  example, 
a  bitter  feud  has  been  raging  for  many  years  between  the  fac- 
tory and  the  local  sickness  societies,  which  had  led  to  the  in- 
sertion in  the  Imperial  Insurance  Code  of  provisions  looking 
forward  to  a  "centralization"  of  sickness  insurance.  This  will 
unavoidably  result  in  increasing  the  power  of  the  bureaucracy. 
Exactly  similar  conflicts,  which  led  to  quite  similar  consequences, 
arose  out  of  the  relations  of  the  employers'  associations  to  sick- 
ness insurance,  (3)  and  also  out  of  the  "question  of  the  physician," 
which  is  still  unsettled,  and  out  of  the  "coalition  agreements," 
which  have  been  entered  into  in  the  course  of  the  struggle  against 
the  social  insurance  sickness  societies.  Each  year  brings  with  it 
new  difficulties.  Whichever  way  one  turns,  new  differences  are 
appearing  which  are  paving  the  way  for  state  administration,  and 
it  almost  appears  as  though  the  course  of  events  had  created  a 
divide  et  impera  in  favor  of  a  system  of  administration  by  the 
state. 

Without  having  sought  these  victories,  state  administration 
is  therefore  making  headway, — but  not  without  preparation  hav- 
ing been  made  therefor.  The  course  of  events  was  already  fore- 
seen years  ago  by  the  heads  of  government  administration,  and, 
when  in  April,  1909,  the  draft  of  an  Imperial  Insurance  Code 
was  made  public,  it  appeared  that  the  government  had  asked  for 
a  new  body  of  officials  to  help  carry  the  burden  of  responsibility. 

It  is  true  that  the  government  was  not  able  fully  to  carry  out 
its  intentions  in  the  Reichstag.  It  was  not  able  to  have  the  "in- 


C1)  Geheimer  Oberregierungsrat  Dr.  Hoffman,  of  the  Prussian  Min- 
istry of  Commerce,  in  an  article  which  appeared  in  the  Preussisches  Ver- 
waltungsblatt  for  1900,  in  Nos.  29  and  31. 

(2)  §359  of  the  Reichsversicherungsordnung. 

(3)  Compare  above:    The  Restorative  Treatment  During  the  Waiting 
Period. 

91 


surance  offices"  accepted  in  the  exact  form  desired,  but  was 
obliged  to  be  satisfied  Avith  "attenuated  insurance  offices."  But 
there  is  no  doubt  but  that  the  entire  completion  of  this  official 
organization  is  only  a  question  of  time.  The  more  fiercely  the 
masses  of  the  people  and  the  political  parties  demand  the  enact- 
ment of  new  social-polity  measures  and  the  greater  the  scope 
of  social-polity  institutions  becomes,  the  sooner  will  we  have  to 
increase  the  powers  of  the  new  official  organization.  It  is  true 
that  serious  misgivings  have  arisen  concerning  the  dreaded 
"bureaucratization  of  social  politics."  The  industrial  owners  and 
the  workingmen  are  united  in  this  feeling  of  misgiving.  But  this 
especially  shows  the  irresistible  force  of  the  march  of  events, 
which  is  accomplishing  its  ends  although  very  few  desire  it. 


As  so  much  w*as  anticipated  from  the  self-administration  of 
social  institutions, (*)  German  social  legislation  will  necessarily 
lose  much  of  its  popular  charm  as  the  scope  of  government  ad- 
ministration becomes  enlarged.  We  have  been  accustomed  to  call 
on  the  state  only  when  it  was  necessary  to  control  a  private  in- 
dustrial owner  and  to  regulate  private  enterprises. (2)  Only  in 
this  way  did  the  expression  of  "the  needful  interference  on  the 
part  of  the  state"  gain  its  attractiveness. 

But  only  now  when  the  system  of  government  administration 
with  all  its  strength  and  power  is  about  to  spread  itself  over  the 
social-polity  institutions  are  we  beginning  to  understand.  We 
realize  how  the  room  for  high  hopes  and  daring  expectations  is 
becoming  narrowed,  and  feel  how  the  effects  predicted  during  the 
era  of  new  creative  efforts  are  fading  away.  Social  policies  grow 
old  and  lose  the  force  exerted  at  the  time  of  their  first  promulga- 
tion. Quite  sober  limits  arise  to  the  movement  which  once  ap- 
peared limitless. 

Whether  good  or  evil  results  from  this  aging  process  depends 
entirely  on  what  attitude  the  people  and  their  leaders  assume 
towards  this  development.  Already  voices  are  being  heard  which 
indicate  a  search  for  new  fields  of  opportunity.  Some  of  those 
who  always  advocated  social-polity  progress,  recall  "the  tragedy 
of  all  great  reform  movements,"  which  is  to  be  found  in  the  fact 
that  the  unintended  effects  ("the  increasing  regulation,  oversee- 
ing and  schematization  of  economic  and  social  activity")  exert 
a  greater  influence  than  the  intended  effects.  (8) 

An  era  in  which  this  truth  is  come  to  be  realized  also  among 
the  masses,  through  "protective  measures  becoming  changed  in- 
to measures  of  subordination,"  such  an  era  is  ripe  for  a  correct 
re-estimate  of  the  importance  of  independence  and  personal  ini- 

(*)     See  conclusion  of  last  chapter  in  Part  III. 
(2)     See  Part  I:    State  Regulation  and  Private  Helplessness. 
(8)     Read,   for  example,   the  sessions  of  the  23d  Evangelical-Soda,! 
Congress,  1912,  with  the  reports  of  Wiese  and  Rade. 

92 


tiative  and  especially  for  a  revaluation  of  those  creative  perform- 
ances in  which  no  governmental  power  can  compete  with  private 
organization^1)  Consequently,  after  a  noble  and  fruitful  era  of 
social  progress,  we  should  make  all  that  has  been  gained  secure 
and  procure  a  breathing  space  for  a  start  on  the  way  to  new 
fields  of  effort. 


See  above:     Government  Ownership  of  Private  Enterprises. 


93 


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